Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — AGRICULTURE, FISHERIES AND FOOD

Pig Industry

Mr. Michael Latham: asked the Minister of Agriculture, Fisheries and Food whether he will now announce further measures to help pig producers.

Mr. Hardy: asked the Minister of Agriculture, Fisheries and Food what action he is taking to ensure that pigmeat production is maintained at a satisfactory level.

Mr. Newton: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on his policy towards the problems of pig producers.

Mr. MacGregor: asked the Minister of Agriculture, Fisheries and Food whether he is satisfied with the present state of the pig industry; and if he will make a statement.

Mr. Boscawen: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the returns presently received by pig farmers.

Mr. Hal Miller: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the returns presently received by pig farmers.

The Minister of Agriculture, Fisheries and Food (Mr. John Silkin): Yes, Sir. I shall announce such measures now.
The method of calculating monetary compensatory amounts on our imports of bacon and other pigmeat should be changed. The present method is unfair to

producers and processors in the United Kingdom. I have proposed to the EEC Council of Ministers that a fairer method be adopted.
In the meantime, our producers are facing very real difficulties. Sow slaughterings are at a disturbingly high level and the breeding herd is being run down. The risk to our pig supplies is obvious. The Government have therefore decided to introduce a temporary subsidy of 5·5p per kilogram deadweight—50p per score—on pigs certified under terms and conditions similar to those which applied under previous subsidy schemes. These payments will rest on the authority of the Estimates and the confirming Appropriation Act. Supplementary Estimates will be presented in due course and meanwhile, if necessary, recourse will be had to the Contingencies Fund. The necessary administrative arrangements are being made with a view to accepting pigs for certification from Monday 31st January.
I believe that this action will be welcomed by all concerned in the industry as a positive step to help them meet their immediate difficulties.

Mr. Latham: Although any help is welcome, is it not true that the Minister has fiddled around for far too long on this matter? [HON. MEMBERS: "Oh."] Since heavy hog producers are currently losing up to £8 per week, by how much will today's announcement reduce that deficit?

Mr. Silkin: I somehow felt that the hon. Gentleman might be a little light in his expression of gratitude, but he is wrong about timing. The House may recall that in November I had conversations with the then Agriculture Commissioner and raised the point with some force about the change in mcas. As a result, we had a small change in the calculation of 8 per cent. I had hoped that the Commission and the Council of Ministers would have come to a fair method of recalculation in the December round of Council meetings. Unfortunately, that did not happen. Following that, this is the earliest moment at which I could have taken the measures, and I have now taken them. Therefore, I have informed the House of the situation at the earliest possible moment.
The figure of 50p per score—I hope that the House will forgive my talking in terms of scores, because I have yet to get used to kilograms—will mean, on average, a subsidy per pig of £3·50. It has been calculated on what the efficient pig producer should require to make pig production profitable.

Mr. Newton: Is the Minister aware that we join in welcoming his reply, but does he not agree that it is worrying that this has taken so long to happen and that a great deal of damage has already been done to confidence? Will he give an assurance that this kind of delay and damage to confidence will not be allowed to happen again?

Mr. Silkin: The granting of a direct subsidy in the way I have announced to the House is not without its difficulties. I should much have preferred it if the method of calculation had been in the form which I have constantly made clear in the House and which I intended to obtain—namely, a recalculation of pigmeat mcas, which always seemed to me to be the best way of settling the matter.

Mr. MacGregor: Will the Minister make clear the situation in regard to heavy hogs, because this will have serious implications for food manufacturers and in terms of employment in the industry? Is he satisfied that today's announcement will be enough to deal with the heavy hog situation? If he is unable to obtain agreement on mcas, which may depend on his willingness partly to devalue the green pound, will he give an assurance that the subsidy will continue until he does so?

Mr. Silkin: If I may deal first with the last part of the hon. Gentleman's supplementary question, it is rather like giving a copy of "Rayden on Divorce" to a newly-married couple. After all, I have only just introduced the subsidy, so let us wait and see. On the other matter mentioned by the hon. Gentleman, I would inform him that this subsidy is based on the pig producer but will have its effects throughout the production cycle. It will have a significant effect on the preservation of jobs and also, I hope and trust, will be of benefit to the consumer.

Mr. Boscawen: We are always grateful for anything we can get from the

Minister, but does he not agree that his reply is still unsatisfactory? Therefore, I give notice that I shall seek to raise the matter on the Adjournment—

Several Hon. Members: Oh!

Mr. Speaker: Order. I did not hear that.

Mr. Watkinson: Is my right hon. Friend aware that farmers in West Gloucestershire will welcome the measures that he has announced today? Is he also aware that they are grateful to him for the consideration he showed when she met a delegation of them at the Ministry earlier this week? Does he accept that there are hopeful signs that feeding costs may be firming up as a result of more stabilisation of grain prices generally, which is an added hopeful sign for the pig industry?

Mr. Silkin: I am grateful to my hon. Friend for what he has said. In return, I may say that I have always believed that British farmers are the most able and intelligent farmers probably in the world, and that high among them are his constituent farmers. Bearing in mind my conversation with them a little while ago when he brought them to see me, they at least will not be totally dissatisfied.

Mr. Peyton: First, Mr. Speaker, I am much obliged to you for your temporary deafness. I hope that it will not be of too long duration.
Is the right hon. Gentleman aware of the extent of our surprise at his gall in accusing my hon. Friend the Member for Melton (Mr. Latham) of being a little light in his gratitude? Is he not aware of just how long we have had to wait for action and even words from him on this subject while the pig industry was being virtually destroyed? Will he now tell us what he intends to do about securing an early change in the arrangement for calculating the mcas? Does he agree that he missed a valuable opportunity early on in not agreeing to a slight devaluation of the green pound to bring this about?

Mr. Silkin: The right hon. Gentleman has addressed his mind to this matter in his usual rather picturesque language, but I have a feeling that temporary deafness must be a little catching in the House. On many occasions I have told the House the exact nature of the difficulties. I have always tried to keep the


House fully in the picture about the difficulty of recalculating the mcas and why I thought it was the best method. If the right hon. Gentleman says that I have been lacking even in words, he should read the appropriate references in Hansard.
The right hon. Gentleman's final question was to ask me why I did not slightly devalue the green pound. The simple answer is that a slight devaluation of the green pound would be accompanied by an equally slight increase, but of exactly the same amount, in the cost of feeding stuffs for our pig producers, which would mean no gain whatsoever. The gain would come from a recalculation of the mcas or in the method I have set out.

Mr. Torney: I congratulate my right hon. Friend on his statement, but is he aware that I, too, am surprised at the gall of the Opposition in daring to criticise when they call all the time for cuts in Government expenditure? By how much will the action that my right hon. Friend has taken today benefit the hard-pressed consumers who have to buy either the pork or bacon that results from the order that he has made?

Mr. Silkin: I do not want to make excessive claims, but the fact is that bacon and pork prices are lower than they have been. The basis of this action is to safeguard supplies for the consumer at the price we are talking about. It would be foolish and, I think, dishonourable of me to claim that it will cause a reduction in the price of these commodities.

Mr. Geraint Howells: I am sure that Welsh pig producers will welcome the statement made by the right hon. Gentleman. I believe that it is a step in the right direction. Will the right hon. Gentleman give me an assurance that, as regards the long term, he will consider the situation again at this year's price review?

Mr. Latham: On a point of order, Mr. Speaker. Now that you have recovered your hearing, may I give notice that I am still dissatisfied and that I intend to raise the matter at the earliest possible moment?

Mr. Speaker: Mr. Luce. Question No. 2.

Mr. Freud: On a point of order, Mr. Speaker—

Mr. Speaker: Will the hon. Gentleman mind waiting until after Questions? We are running very slowly. [Interruption.] I realise that the Minister has not answered. I hope that the House will not mind very much if I do not hear the hon. Member for Melton (Mr. Latham) until after the reply.

Mr. John Ellis: On a point of order, Mr. Speaker. It seems that when you hear things and when you do not is completely arbitrary. Some of us have seen the Minister recently, and there have been—

Mr. Speaker: Order. I know that the hon. Gentleman is disappointed that he was not called. Does the Minister wish to answer the supplementary question of the hon. Member for Cardigan (Mr. Howells) before I hear again?

Mr. Silkin: With your indulgence, Mr. Speaker, I think that might not be a had courtesy to give to the hon. Gentleman who has made a fair point. As I have said, I think that the correct process is that of recalculation of the mcas. However, I have no doubt that that will now find itself, in view of the time scale, coming into the discussion on other matters.

Mr. Speaker: Mr. Latham.

Mr. John Ellis: Shame!

Mr. Latham: I repeat, Mr. Speaker, that in view of the unsatisfactory nature of the reply I give notice that I shall seek to raise the matter at the earliest possible opportunity.

Later—

Mr. John Ellis: May I now raise my point of order, Mr. Speaker? In response to your request, I have deferred it until the end of Questions. May I invite your consideration of what happened on Question No. 1 to the Minister of Agriculture? Hon. Members used the device of giving notice that they wished to raise the matter on the Adjournment. That was done, I think, three times. I understand the difficulty of the Opposition when Back Benchers are called who have not tabled Questions. But when other hon. Members


who have not put down Questions are excluded from asking supplementary questions your diplomatic deafness, which was exercised on the first two occasions, gives rise to a sense of resentment if it is apparently used in a discriminatory way to give preference to some Back Benchers. If we are to have a device such as this which enables hon. Members to curtail discussion on a Question, the application of that device should be made in such a way that it does not create dangers and get us into the difficulties that we saw today.

Mr. Speaker: I should inform hon. Members who were not in the House earlier this afternoon that five other Questions were grouped together with Question No. 1. Following my policy of calling those whose Questions are being answered, I endeavoured to try alternately to call hon. Members from either side of the House, and I succeeded in calling some. I understand the hon. Member's frustration, but I hope he is not even hinting at discrimination by me against anyone. Naturally, Mr. Speaker likes to please everyone if he can—just like an hon. Member in his constituency. That is not always possible. However, I shall do my best.

Fisheries Policy

Mr. Luce: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the position of British fishing interests in the light of the latest developments in the EEC negotiations.

Mr. Adley: asked the Minister of Agriculture, Fisheries and Food if he is satisfied that the interests of inshore fishermen are being adequately safeguarded in the negotiations in which he is currently engaged.

Mr. Wall: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on the progress in renegotiating the common fisheries policy.

Mr. Warren: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on his Department's part in current international negotiations affecting United Kingdom inshore fishing rights.

Mr. Mudd: asked the Minister of Agriculture, Fisheries and Food what is the present position in his discussions on an interim internal fisheries agreement in the Community.

Mr. Bowden: asked the Minister of Agriculture, Fisheries and Food what is the present position in his discussions on an interim internal fisheries agreement in the Community.

Mr. John Silkin: Negotiations on a number of important issues are continuing affecting the future of the CFP. Discussion has so far centred mainly on fishing by non-member countries in the waters of Community States and on conservation measures. Good progress is being achieved on the first of these issues. As regards conservation measures, our object has been to obtain agreement to the urgent introduction of specific measures needed to conserve the fish stocks on which the future of the British industry depends. While we have agreed the temporary standstill in catch and not to introduce new conservation measures on  national basis in January, it would be dangerous to allow the present situation in which there is no adequate control on fishing to continue indefinitely.
The four most urgent measures are a ban on herring fishing in the North Sea, a restriction of the area in which Norway pout may be taken at the expense of white fish stocks, a stricter control on by-catches, and a prohibition of the carrying of nets of different mesh sizes on the same voyage. We are informing the Commission that these are the measures which we see as the most urgent. We hope to see them introduced on a Community basis, but if this is not possible we are entitled under The Hague Agreement to introduce them ourselves.

Mr. Luce: I welcome what the Minister has said as far as he has gone. Is he aware, however, that among British inshore fishermen there is a deep sense of despair that not only the Government but the Community have not up to now fully understood that the quota system has completely broken down, largely due to abuse by other countries, notably Belgium? In the light of the alarming reports in today's Financial Times that there is a difference between the Minister and the Foreign Secretary, and that the


Foreign Secretary may be rather weak in the negotiations in Brussels, will the right hon. Gentleman reassure the House that in the last resort he will be prepared to take unilateral action to conserve British fish stocks?

Mr. Silkin: As for newspaper reports about differences or divergencies between my right hon. Friend and myself, there are differences in the bases of our two Departments, and it is inevitable that there should be. Obviously, my right hon. Friend has to consider the wider aspects of external relations while I consider more technical matters. I suppose it is always possible to say that that is a divergence. I go no further than that, except to say that I agree with what my right hon. Friend said yesterday in his statement.
I can assure the hon. Gentleman that we stand ready to introduce our own national conservation measures if the Community does not do so. I have said that on many occasions, including on Second Reading on the Fishery Limits Bill.

Mr. Jay: Is my right hon. Friend aware that if on this matter of fisheries he continues to do his job, to stand up for British interests and resist appeasement, from wherever it comes, he will have the overwhelming support of almost every right hon. and hon. Member?

Mr. Silkin: I am grateful to my right hon. Friend. I notice that the House is always very alive and awake even after it has had an all-night sitting.

Mr. Adley: I thank the Minister for his statement, as far as it went. Is he aware that many of my constituents are particularly concerned about the activities and methods of Russian and East European fishermen off the South Coast? Can he say something about whether the defence cuts announced recently will hamper or reduce the Navy's activities in doing its best to police the waters around our shores?

Mr. Silkin: I suppose that properly I should say that that is a matter for my right hon. Friend the Secretary of State for Defence, but I am pretty satisfied that our fishery protection measures will be sufficient to deal with the question. I say "pretty satisfied" because we are

in a totally new situation and it would be unfair to say how it will all work out while it is still in its early stages, perhaps for a few weeks or a month or two. I warned the House that this was likely to be the case. We shall certainly keep the situation under constant review.

Mr. Powell: Is the right hon. Gentleman aware that his robust approach to the defence of British interests is appreciated outside as well as inside the House? But will he also tell his fellow Members of the Cabinet that another urgent matter is the entrusting of the enforcement of quotas and limitations on fishing within the British extended waters, by both non-EEC and EEC boats, to licensing by the United Kingdom Government?

Mr. Silkin: I am grateful to the right hon. Gentleman for what he has said. The question of a licensing basis is absolutely vital. It is a matter to which I believe my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs referred yesterday.

Mr. Wall: Is the Minister aware that we have considerably more belief in his negotiating powers than in those of the Foreign and Commonwealth Office? Will he insist on effort quotas rather than catch quotas, a matter which is fundamental to the industry? If negotiations with the EEC fail, is he prepared to recommend to his Cabinet colleagues that we should have a unilateral exclusive zone around our coast?

Mr. Silkin: I know that in the first part of his question the hon. Gentleman was trying to be kind, but he will not be able to insert too much of a wedge be-between the negotiating powers of the Foreign and Commonwealth Office and my own very poor negotiating powers. [Interruption.] I freely admit it. The House always likes one to speak honestly. As for the coastal belt, which I think is what the hon. Gentleman is referring to, my position and that of the Government remains exactly as it was. I rather agree with the hon. Gentleman on effort limitation, which is still our aim.

Mr. James Johnson: Is my right hon. Friend aware that the negotiations and the whole atmosphere are completely different from anything that has happened in the past, because for the first time we


have a Dane, Mr. Gundelach, negotiating on our behalf? That is contrary to all our history and experience. Therefore, will my right hon. Friend, of all Ministers, be most open about the whole matter and acquaint the House with what is going on as he is doing today? I hope that he will also meet Back Benchers at every possible opportunity, because inside and outside the House there is a feeling of uncertainty. It is a psychological situation.

Mr. Silkin: I am grateful to my hon. Friend for what he has said, and I readily give the assurance that he sought. I have a great deal to learn, and I am not too proud to admit it. Those with fishing constituencies in particular can help me and teach me in the job I am doing.

Mr. Warren: I welcome the first indication that we have had in the House of a more robust attitude towards the negotiations, but will the right hon. Gentleman, while maintaining that attitude, give a categorical assurance that the minimum fall-back he would be willing to accept for conservation purposes and to protect the livelihood of inshore fishermen is an exclusive 12-mile limit around our coast?

Mr. Silkin: The position was clearly stated on 4th May last year by my right hon. Friend the Secretary of State for Prices and Consumer Protection when he was Minister of State for Foreign and Commonwealth Affairs. That statement went a long way beyond the hon. Gentleman's 12 miles.

Mr. Mudd: Without wishing to detract from what the right hon. Gentleman has said, which is accepted and appreciated, may I ask whether he will accept that the great fear of the Cornish inshore industry is that violations of fishing grounds are more likely to be carried out by our so-called European partners than by other people? Therefore, will the right hon. Gentleman consider for once enlisting the active support of the EEC, with the setting up of a European Communities fisheries protection squadron, in the hope that, thus involved in protection, the other EEC countries will realise our reasons for prohibition?

Mr. Silkin: There needs to be a great deal of protection against not only our EEC colleagues but even our own nationals. We must conserve the stocks

of fish in the sovereign waters around our shores. Obviously, if there were an unlimited supply of fish we should need no quotas and no conservation, and anyone could come and take the fish. Unfortunately that is not the case.

Mr. Bowden: The Minister's honesty in saying that he is willing to learn about the fishing situation will be greatly welcomed by the inshore fishermen in Brighton. Will he take an early opportunity of coming to Brighton and the Sussex Coast to meet those men? They will tell him that the quota system will not work and that almost every day large trawlers are taking the fish out of the seas in their area, and that unless that is stopped their livelihood will be ruined.

Mr. Silkin: The invitation is so attractive that I am almost inclined to conceal from the House that I already knew the facts of what the hon. Gentleman was saying.

Mr. Peyton: May I take the right hon. Gentleman back to the question asked by my hon. Friend the Member for Haltemprice (Mr. Wall)? Will he accept that catch quotas do not work? They are unenforceable and command nobody's respect, so perhaps he could put that idea away. Secondly, will the right hon. Gentleman consult whichever of his right hon. Friends is most appropriate on how he will put teeth into whatever policy is arrived at, because the problem of enforcement will now be of a very different order and much more difficult than before?

Mr. Silkin: I fully accept both points made by the right hon. Gentleman. I was fairly early impressed by the basis of effort limitation and think that it is the right way of doing things. It is ludicrous merely to draw pretty lines on a chart, say "These are our sovereign waters" and not deal with the question of enforcement. I hope, however, that the House will be a little sympathetic on this matter. This is so new a basis for us that we must treat this as a kind of test period in which we can see how things work. I hope that they will work out all right.

Mr. Watt: The House will welcome the ban on fishing for North-East Coast herring, but does the right hon. Gentleman think that he can make the ban


effective on the boats of all nations? Is he aware of the present gross overfishing for Shetland herring and West Coast herring by boats of several nations? Does he know that the stocks are not getting into the Minch, where our fishermen traditionally catch them, because of the fantastic effort of those other nationals?

Mr. Silkin: Like the hon. Gentleman, I hope that we can make the ban effective. That is the whole point of imposing it. With regard to the hon. Gentleman's second question, I hope he understood that I was talking about the first four of the urgent conservation measures. I can think of a number of candidates for a further extension of conservation measures.

Common Agricultural Policy

Mr. Marten: asked the Minister of Agriculture, Fisheries and Food whether he has any proposals to change the intervention system.

Mr. Molloy: asked the Minister of Agriculture, Fisheries and Food what modifications to the common agricultural policy have been achieved by Her Majesty's Government.

Mr. Ioan Evans: asked the Minister of Agriculture, Fisheries and Food what changes in the common agricultural policy have been sought by Her Majesty's Government.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang): I would refer the hon. Member and my hon. Friends to the regular statements to the House by my right hon. Friend after Council meetings. Also, I would refer to the reply given to the hon. Member for Banbury (Mr. Marten) and my hon. Friend the Member for Aberdare (Mr. Evans) on 9th December 1976.

Mr. Marten: As the CAP has been responsible for so much of the justified ridicule about the Common Market as a whole, is there any good reason why the Common Market itself should not continue even if the CAP were abolished and we had our own national policy? Surely the Common Market could still go on with its very important job of harmonising chestnut puree and smoked eel and gas meters without the CAP.

Mr. Strang: I agree with the hon. Gentleman that much of the CAP is by no means essential to the philosophy and framework of the European Community. In the meantime, I am sure the hon. Gentleman would agree that in the short term we must continue to press for a change in the situation whereby we have continued the costly over-production of commodities such as milk.

Mr. Evans: While agreeing with other hon. Members who applauded the action taken by the Minister in the negotiations, may I ask my hon. Friend to try to end the CAP altogether with regard to this country and revert to our former system of guaranteed prices to the farmers? Under that system the housewives benefited by low food prices. There is now growing discontent about the effect of the CAP on food prices.

Mr. Strang: My hon. Friend's point about guaranteed prices has some force. It has to be said, however, that the variable premium that we established for beef in effect represented a return to something near to the older arrangement. It is in practice a deficiency payment or guaranteed price without full-scale intervention. I would certainly accept that we have a long way to go as regards the way in which the central misuse of resources which exists in the Community is a direct consequence of the CAP policy of over-pricing.

Mr. Peter Mills: Is not the real problem—it is shown in the White Paper and in the production results last year—that the Government are dithering between a national policy and a European agricultural policy? In the long run that is totally unfair to the producer and the consumer. What is needed is for the Government to make up their mind and then to see that we have full parity within the union within two or three years.

Mr. Strang: I cannot accept that. For example, we believe it is absolutely right that our relatively efficient dairy industry should produce a higher proportion of Community milk output while at the same time expensive and excessive production on the Continent should be curtailed.

Mr. Spearing: Does my hon. Friend remember the debates that we had on the marketing boards, and does he recall


that the entire House supported the marketing board system? Would it not help to solve the problem of European agriculture if the CAP adopted many of these systems? Cannot my hon. Friend press that upon his colleagues in the Council?

Mr. Strang: My hon. Friend has raised an important point. I would reassure the House of my right hon. Friend's determination to retain the essential functions of the marketing board for orderly marketing in this country. My hon. Friend may be interested to know that some of our Back Bench colleagues in the European Parliament have been trying to interest their European counterparts in this very issue in order to extend marketing boards to other member States.

Green Pound

Mr. Dykes: asked the Minister of Agriculture, Fisheries and Food what adjustments he now proposes to make in the valuation of the green pound in consultation with his colleagues in the EEC Agriculture Council.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. E. S. Bishop): I would refer the hon. Member to the reply given to my hon. Friend the Member for Fife, Central (Mr. Hamilton) on 13th January 1977. As was made clear then, the Commission's proposal for a 4·5 per cent. devaluation of the green pound remains on the table but we do not consider now to be an appropriate time to make such a change.

Mr. Dykes: Does not that mean that the change will come perhaps a little later? While appreciating that the interests of consumers have to come first, may I ask whether it is not rather dishonest of the Minister and his right hon. Friend to maintain that they will not make any changes at all when at least a marginal change along these lines to start with, and perhaps something else afterwards, is inevitable? There is a ground swell of legitimate anger in Germany that the overall cost that it is now contributing to the Community has gone up last year from 7 billion to 12 billion deutschemarks.

Mr. Bishop: I wish that hon. Gentlemen opposite, and many people outside, would get this matter in perspective. They

seem to talk about the green pound and Community aid as though they were charities. The facts are rather different. Is it a charity when the United Kingdom will be paying one-fifth of the whole Community budget this year? It is not a charity when the United Kingdom pays through mcas into the pockets of the European agricultural exporters to help them dispose of their products. It is not charity when we pay money towards facilities from many of which we receive very little benefit. The hon. Gentleman and his hon. Friends should look at the matter in perspective and not in a one-sided way.

Mrs. Dunwoody: Does my hon. Friend accept that it would not be in the interests of the British farmer if we were to allow automatic realignments of the green pound? Will he resist strongly any attempt to take this decision out of the hands of the Council of Ministers and make it into machinery that works automatically irrespective of the interests of member States?

Mr. Bishop: My right hon. Friend has taken a robust stand on this, as on other things. We have made clear already the effect of automatic changes. Basically changes, where necessary, should be carefully timed. We have not been doctrinaire. My hon. Friend is right in saying that this is a matter which is many-sided, and it does not always help the farmer because, for example, of the increased cost of feedstuffs when changes are made.

Mr. Jopling: Is the Minister aware that many of us were alarmed when we heard the Miinster call in aid a policy which is providing an increasing market in this country for producers in the remainder of the Community? Is the hon. Gentleman intent on giving away all our home food market to European producers? When will this stop, and how does this line up with the Government's own White Paper "Food from Our Own Resources"?

Mr. Bishop: The hon. Gentleman has either a short memory or bad hearing. I rather thought he was cheering, in a disguised way, the statement made by my right hon. Friend about pigmeat. That is another situation where exporters from abroad, with mca help, can dispose of their products in a way that is not always helpful to our producers.

Mr. Shepherd: asked the Minister of Agriculture, Fisheries and Food what is the present disparity between the green and market rate of the £ sterling.

Mr. Bishop: The monetary compensatory amount percentage is now 36·9, based on a gap between the representative rate and the market rate used for this purpose of 38·4 per cent.

Mr. Shepherd: Having regard to all aspects of the Minister's departmental remit, is he fully satisfied, and, if so, why?

Mr. Bishop: As I explained in reply to the earlier Question, this matter is under review all the time in relation to the situation facing the producer and also the consumer.

Mr. Corbett: Is not my hon. Friend aware that a bigger problem, apart from the revaluation of the green pound, is the total shambles of the common agricultural policy? Is it not towards the sensible reformation of it or its complete abandonment that the Government's main efforts should be directed?

Mr. Bishop: My hon. Friend will recognise that the facility of the green pound is one that we inherited when we entered the Market and that it is very important that we should ensure its use until some other fundamental change can be made, with the interests of the consumer and of the producer in mind.

Mr. Watt: Does not the Minister agree that the best way of getting rid of this disparity and of ensuring continuity in the supply of food, while at the same time giving some return of confidence to the British producer, would be to allow a devaluation of 1 per cent. per month?

Mr. Bishop: I have already replied to a Question about automatice revaluation. The timing is fundamental to this, and we should make changes in the value of the green pound only in relation to the national interest. Incidentally, a 4½ per cent. devaluation along the lines proposed at present by the Commission would add another 1 per cent. to food prices. It is very important that we keep in mind the policy of monetary restraint at present.

Animal Medicines (Sale)

Miss Fookes: asked the Minister of Agriculture, Fisheries and Food if he will reverse his decision to permit the retail sale of animal medicines on the "Farmers' List" under Part III of the Medicines Act in the light of representations made to him by the Royal College of Veterinary Surgeons and the British Veterinary Association.

Mr. Strang: No, Sir. We believe that the best course is to implement the "Farmers' List" proposals and proceed thereafter with a detailed review of the retail sale requirements appropriate to the different products on the list.

Miss Fookes: Why is the Minister ignoring the considered views of the BVA, which is an expert body and which considers that these particular medicines are unsafe for general sale? Does the hon. Gentleman hold its views in complete contempt?

Mr. Strang: Of course we do not hold its views in contempt. We shall be taking its views fully into account when we consider these products one by one. The hon. Lady will recognise that there is a wide range of views throughout the industry generally, and among producers of these products, as to the right way to sell them.

Mr. Ogden: My hon. Friend will know of my special interest in pharmaceutical matters. Will he agree to meet a joint deputation, if this can be arranged, of the veterinarians and the pharmacists? Will he undertake that safety will be the overriding consideration in his mind and that of his right hon. Friend?

Mr. Strang: Yes indeed. We have already met representatives of the pharmacists and the veterinarians. I shall be happy to meet them again if my hon. Friend so wishes.

Sugar Refining

Mr. Spearing: asked the Minister of Agriculture, Fisheries and Food when he expects to announce Her Majesty's Government's plans for the port cane sugar refining industry.

Mr. John Silkin: As my hon. Friend knows, I shall be visiting the refinery in


his constituency tomorrow. I have been pressing forward discussions with the refiners, the unions representing their workers, and other interested parties, and I hope in the near future to be able to make a full statement.

Mr. Spearing: I thank my right hon. Friend for that answer and, in advance, for the visit which he will be paying tomorrow to the refinery in my constituency. Is he aware that the length of time that the Government have taken to reach a decision has caused uncertainty and that this is a very long-delayed exercise consequent upon our joining the Common Market? Has there been co-operation from my right hon. Friend's colleagues on the Council in appreciating the problems that our joining the Common Market has had on employment in the port cane sugar refining industry?

Mr. Silkin: There has been a good appreciation of the situation in this country in the port cane sugar refining industry. The problem that we have to face here is how we can preserve employment in areas like my hon. Friend's constituency which will inevitably be affected, and perhaps would have been affected regardless of our joining the Common Market, by the increasing importance of beet sugar. I hope that the uncertainty which my hon. Friend talked about is much less than it was. Certainly I am determined to do my best to arrive at a conclusion which will safeguard the jobs of as many as possible of my hon. Friend's constituents and all the others concerned.

European Community Commissioner

Mr. Spence: asked the Minister of Agriculture, Fisheries and Food what discussions he has had with the new EEC Commissioner for Agriculture.

Mr. John Silkin: I have met Mr. Gundelach on a number of occasions in the last few weeks, most recently on 12th January. I expect to be seeing him again next week.

Mr. Spence: Will the Minister say to what extent his desire to have the mcas recalculated is being inhibited by his refusal to look at devaluation of the green pound?

Mr. Silkin: I had better explain this again. The basis of the recalculation of

mcas, which is what the hon. Gentleman is referring to, and what I should like to see as much as he would, has nothing to do with the green pound. If one devalues the green pound, one also puts up the costs of feeding stuffs, so there is no benefit. The Commission itself recognised this in November of last year. Of course, if we went to a devaluation of 36 per cent. there would be a difference—everyone knows that—but no one in this House would contemplate that for a moment. The recalculation of mcas in November of last year was done by the Commission. It was all that it had power to do, and it recognised the truth of what I have been saying.

Mr. Raphael Tuck: When my right hon. Friend sees the Commissioner for Agriculture, will he remind him that the late President de Gaulle said that the CAP would be a crippling blow to the British economy? Will my right hon. Friend try to get rid of it as soon as possible so that we have a national system of agriculture?

Mr. Silkin: I shall not only remind him of it. If my hon. Friend likes and if I can get a proper translation, I shall say it in French.

CABINET MINISTERS

Mr. Tim Renton: asked the Prime Minister whether he proposes to make any further Cabinet changes.

The Prime Minister (Mr. James Callaghan): The hon. Member may assume that I do not intend to make any changes in ministerial appointments or responsibilities unless and until I make a statement to the contrary.

Mr. Renton: That was an extraordinarily hypothetical answer. Is the Prime Minister really satisfied with the way in which the Secretary of State for Prices and Consumer Protection is discharging his responsibilities in relation to bread, and, if so, why?

The Prime Minister: My right hon. Friend made a very bold effort to try to meet the views of the Opposition about reducing prices. He should be stimulated in these matters and not discouraged by the Opposition's criticism.

Mr. David Steel: Will the Prime Minister try to ensure the inclusion of someone in his Cabinet who is sensitive to the needs of manufacturing industry? Is he aware that, whatever may have been the case for phasing out the regional employment premium, its sudden cancellation caused total havoc with forward pricing and contractual arrangements in manufacturing industries in the development areas?

The Prime Minister: The total number of measures taken concerning manufacturing industry do not, I think, warrant the general condemnation implied by the right hon. Gentleman. There is great sensitivity, as I try to show constantly at Question Time and in my meetings with the CBI—which, incidentally, take place regularly and are not held simply now and again—about these matters.
As regards the regional employment premium, I know about the impact of it and I have heard about some of its effects. But it had become so small in relation to the total wage bill to be much less significant than when it was first introduced.

Mr. Robinson: Is my right hon. Friend aware that in the person of his economic adviser he already has someone in the Cabinet who is sensitive to the problems of manufacturing industry and that, moreover, we would regret to see any change in the very constructive rôle that he is playing in the Meriden negotiations?

The Prime Minister: I know that I have often had occasion to thank my right hon. Friend for the services which he has given in a great many directions. I have no hesitation in saying that he is worth every penny that we pay him.

Mrs. Thatcher: May I take it from the Prime Minister's first reply that in his new capacity as economic supremo, therefore, he stands four square behind the Chancellor of the Exchequer, whose first objective is now to reduce the level of income tax, rather than behind some other members of his party who seem to want to increase public expenditure?

The Prime Minister: The Government's policy in relation to both public expenditure and taxation is very clear. I am not so sure about the attitude of the Opposition on matters of public

expenditure. Despite their protestations at the Dispatch Box, they do not seem to reproduce them in Committees upstairs.

Mrs. Thatcher: Apparently the Prime Minister's answer to my question is that he does not stand four square behind the Chancellor in his first objective of reducing income tax.

The Prime Minister: I was saying that it is not simply for the right hon. Lady to make these protestations about cuts in public expenditure at the Dispatch Box, but also to see that what happens elsewhere in this House is in accordance with her public protestations here. As she knows, that is not happepning in the Committees of the House.
As for rates of taxation for next year, I fear that I cannot anticipate my right hon. Friend's Budget Statement.

PRIME MINISTER'S QUESTIONS

Mr. Tebbit: asked the Prime Minister if, following his statement of 21st December, Official Report, column 465, he intends to give evidence to the Select Committee on Procedure concerning the nature of the Questions he is willing to answer during Prime Minister's Question Time.

Mr. Rost: asked the Prime Minister what proposals he has for improving Prime Minister's Parliamentary Question Time in the light of his remarks on 21st December 1976.

The Prime Minister: The Government referred Questions to the Prime Minister to the Sessional Procedure Committee on 12th January. During the Christmas Recess I made a detailed study of the development of Prime Minister's Question Time since 1945, hoping to find ways of improving the procedure, but I could not do so. I am therefore ready to await any conclusions that the Select Committee may reach.

Mr. Tebbit: Will the Prime Minister try answering the question for a start? Will he cast his mind back to 21st December? Does he remember that on that occasion he introduced and discussed at length the subject of the National Association for Freedom, for which he


has no ministerial responsibility, yet he still refuses to say whether the Marxist speech of his fellow-travelling Energy Minister represents Government policy?

The Prime Minister: The hon. Member for Chingford (Mr. Tebbit) illustrates one conclusion which I had long since come to—that, apart from the merits of the answers, the effectiveness of Question Time depends on the good sense of the questioner.

Mr. Rost: If we could clear the procedural jungle on the Prime Minister's Parliamentary Question Time so that it was possible to deploy Questions in a more straightforward and sensible way, would the Prime Minister live up to his side of the bargain to uplift the value of Parliamentary Question Time by occasionally answering the question?

The Prime Minister: It is very difficult sometimes to give sensible answers to daft questions. As regards the future, the hon. Member for Derbyshire, South-East (Mr. Rost) and I share a feeling about this matter. It is one which has gone to the Select Committee on Procedure. I read what happened last time in 1971–72 when the Committee did not seem to come up with anything. However, I promise the House that I shall try hard if I get sensible questions.

Mr. Corbett: Will my right hon. Friend be just a little more generous? In view of the consistently poor quality of questions from the Opposition, will he make available to them on an adviser basis some of the services which are available at Downing Street in order to get more sensible Questions put on the Order Paper?

The Prime Minister: That is one way of doing it. Another way would be to see that whichever authority supplies the syndicates of hon. Members with questions also supplies them with answers.

Mr. Tebbit: It is your job to give the answers.

PRIME MINISTER (ENGAGEMENTS)

Mr. Luce: asked the Prime Minister what his engagements are for Thursday 20th January.

Mr. Skinner: asked the Prime Minister if he will list his official engagements for 20th January 1977.

Mr. Dykes: asked the Prime Minister if he will list his engagements for Thursday 20th January.

Mr. Gow: asked the Prime Minister whether he will list his engagements for 20th January 1977.

Mr. Blaker: asked the Prime Minister if he will list his engagements for 20th January 1977.

The Prime Minister: This morning I chaired a meeting of the Cabinet, and I shall be holding further meetings with ministerial colleagues and others.

Mr. Luce: In view of the considerable public discussion about the rôle of the United Kingdom in relation to countries which abuse human rights, will the Prime Minister take the opportunity of his engagement at Question Time to express his views? Does he agree that we are more likely to influence other countries in the way we want through a policy of contact rather than through a policy of boycott and isolation?

The Prime Minister: To give a complete answer to that question, I would want to reflect longer. The general position is that contact is good. I believe that it is good between Government and Government and between individuals, but there are always particular cases which arise out of these principles. As far as human rights are concerned, I have made clear many times since the signing of the Helsinki Agreement that there are various ways to approach other signatories of the agreement. One is by way of Government, though this should not necessarily be publicised or appear to be a gesture. The other way is by the expression of general public opinion on these matters, for which the Government take no responsibility. Both methods are right ways to pursue the objective that everyone throughout the whole civilised world can live in peace and dignity and under the rule of law.

Mr. Skinner: Will the Prime Minister take time to look at a Question which I put down last week asking him to


instruct Ministers and officials not to patronise Trust Houses Forte hotels while they refuse to accept the recognition of trade unions and there are people on the picket lines in many towns and cities throughout the country? Is it not the height of hypocrisy that when the Tory Party leadership is trying to woo the trade unions—

Sir J. Langford-Holt: On a point of order, Mr. Speaker. Can you enlighten the House as to what on earth this supplementary question has to do with the original Question?

Mr. Speaker: If I tried to tell hon. Members that about supplementary questions, I would do nothing else.

Mr. Skinner: The Question got through the Table Office last week, therefore it must be in order. As I was saying, is it not the height of hypocrisy that, at a time when the Tory Party leadership is trying to woo the trade unions, one of the consultants involved in the Trust Houses Forte hotel business, advising it on employment matters, is none other than the Tory Shadow Employment Minister, who last October was telling members of the Tory Party Conference to join trade unions?

The Prime Minister: I am not acquainted with the details of the Trust Houses Forte dispute, but I hope that everyone on both sides of the House, including the Shadow Employment Minister, will urge Trust Houses Forte to accept trade union recognition for its members. That is essential for good relations in industry. As regards where people should stay, I do not wish to issue any instructions on this matter.

Mr. Dykes: Since the Prime Minister is becoming increasingly proud of his regular meetings with the CBI, would he say unequivocally, so that we all know, that he accepts the CBI's case for lower marginal rates of personal taxation on middle management?

The Prime Minister: There is little doubt that middle management feels that it has been very harshly treated over recent years, and a feeling of dissatisfaction of this sort clearly must be taken into account. The hon. Member, however, does not really expect me to anticipate the Budget.

Mr. Gow: Will the Prime Minister reflect on the answer he gave to my hon. Friend the Member for Shoreham (Mr. Luce) when he said that it was his aim to see that our people live in peace and dignity and under the rule of law? Will he bear in mind the conduct of the Secretary of State for Employment over the operation of the closed shop, notably in British Rail, where more than 31 employees, many with a lifetime of service, have been dismissed, in direct conflict with the three principles which the Prime Minister enunciated?

The Prime Minister: I think that the Opposition are in some difficulty over the closed shop. Having read the statement in their new policy document, I think they will find this very difficult to carry out. They should keep up to date, especially as only yesterday a new chapter was inaugurated between the Conservative Party and the trade union movement. Hon. Members should remember that.

Hon. Members: Answer the question.

Mr. Blaker: Will the Prime Minister take five minutes this afternoon to convey to the National Executive Committee of the Labour Party the satisfaction of Opposition Members about the fact that it has confirmed the appointment of Mr. Andy Bevan, and has thus hung a red albatross around the party's neck for the next General Election?

The Prime Minister: This is not a matter for me. That question illustrates yet again the level to which Question Time has sunk.

Mrs. Millie Miller: Will my right hon. Friend bear in mind, referring back to the earlier answer he gave about the plight of people who are not able to express views in their own countries and who do not have the freedom to move away from them, the heinous crimes committed in some countries with extreme Right-wing Governments? Will he also bear in mind the need to ensure that, although we carry on trade and have contacts with them, these countries are aware all the time of our views of their behaviour in relation to human rights?

The Prime Minister: My hon. Friend expresses it exactly. In the case of South Africa, for example, we have made it


quite clear that we accept the United Nations decisions on these matters in relation to the supply of arms. However, we have maintained the flow of trade between our two countries. I would say that relations between us are cool; they certainly do not have the degree of warmth or intimacy that we have with a number of other countries. This is true of all countries whatever part of the political spectrum they inhabit.

Mr. Whitehead: Will my right hon. Friend go so far as to express the regret which most hon. Members feel at the arrest of so many of the signatories of Charter '77 in Czechoslovakia, many of whom are Socialists, trade unionists and civil rights workers?

The Prime Minister: I have no hesitation in doing that. It was, after all, the Labour Government in 1968 who called the House back from recess at a time of events which merited condemnation by the whole of the British people. That was our position then and it is still our position.

BUSINESS OF THE HOUSE

Mrs. Thatcher: May I ask the Leader of the House to state the business for next week?

The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): The business for next week will be as follows:
MONDAY 24TH JANUARY—Second Reading of the Water Charges Equalisation Bill.
Motions on the Road Vehicles (Registration and Licensing) (Amendment) Regulations.
TUESDAY 25TH JANUARY AND WEDNES DAY 26TH JANUARY—Further progress in Committee on the Scotland and Wales Bill.
THURSDAY 27TH JANUARY—Supply [4th Allotted Day]: There will be a debate on the prevention of crime, on a motion for the Adjournment of the House.
Motion relating to the Adoption Agencies Regulations.
FRIDAY 28TH JANUARY—Private Members' Bills.
MONDAY 31ST JANUARY—Second Reading of the International Finance, Trade and Aid Bill.

Mrs. Thatcher: I have two questions for the Leader of the House. Judging from the business, it looks as though it is his general intention to devote Tuesday and Wednesday each week to the Scotland and Wales Bill. Will he tell us whether that is so?
Last week we raised the question of a foreign affairs debate. We did not have a general foreign affairs debate in Government time during the whole of the last Session. Will the right hon. Gentleman therefore see that it features in his next Business Statement?

Mr. Foot: It is our general intention to try to hold the debates on the Scotland and Wales Bill on Tuesday and Wednesday as a normal rule, but I should not like to be bound to that absolutely. That is the general proposition.
I know that the right hon. Lady put the question of a foreign affairs debate to me before. It has been the case on previous occasions when Conservative Governments were in power that very often the Labour Opposition had to take their time, for example, on Queen's Speech days, in order to secure a general foreign affairs debate. That was the choice of the Opposition. That did not happen last Session or on similar occasions. I agree that at some stage we shall have to have such a debate. We must look at that, but I can make no promise now.

Mr. Lipton: Will my right hon. Friend note that it has taken three days, including an all-night sitting, to dispose of one clause of the Scotland and Wales Bill? As he knows, the Bill contains 155 clauses and 16 schedules. Will he consider, since some of us are getting a bit fed up with this Bill—[HON. MEMBERS: "Hear, hear."]—appointing a Committee consisting only of those hon. Members who wish to speak on the Bill and sending them all upstairs?

Mr. Foot: I note not only the circumstances described by my hon. Friend but the popularity of some of his suggestions. However, I cannot believe that that is the right way to deal with a constitutional Bill of this nature. I am certainly noting the circumstances of the time that we are taking, however.

Sir Bernard Braine: Does the Leader of the House recollect that last week I drew attention to the almost unprecedented action of a High Court Judge in directing the attention of the Attorney-General to the fact that his court was powerless to right a wrong that Her Majesty's Government have done to the Banaban people? I pressed for a Government statement. In view of the widespread interest in the matter and the feeling that the honour and duty of the Government are at stake, will the right hon. Gentleman say whether such a statement will be made at an early date?

Mr. Foot: I must apologise to the hon. Gentleman that I have not secured for him a statement on that subject, but my right hon. and learned Friend the Attorney-General has been fully engaged in the last day or two defending the honour, reputation and rights of the House of Commons.

Mr. Faulds: When may we have a statement about developments in the negotiations towards the liberation of Zimbabwe?

Mr. Foot: Of course that matter is of great importance. I am sure that the Foreign Secretary will report to the House on the subject as soon as he thinks it desirable and helpful that such a report should be made. The fact that a report has not been made to the House does not indicate any withdrawal of interest by the Government in trying to secure progress in the matter.

Mr. John Davies: Will the Leader of the House say when we shall get the Bill on direct elections to the European Parliament? Is he aware that the Government's foot-dragging on this question is a matter of severe concern not only in this country but throughout Europe? Will he live up to his promises and let us have the Bill forthwith?

Mr. Foot: The Government have never promised that the Bill will be available forthwith. Therefore we are not breaking any promise. However, I note what the right hon. Gentleman said.

Mr. Greville Janner: In view of my right hon. Friend's commitment to worker participation in industry, can he say when he expects to lay before the House the code dealing with disclosure of

information to trade unions? Please may it be soon?

Mr. Foot: I am not sure on which day it is proposed to lay the code, but I will ask my right hon. Friend the Secretary of State for Employment to communicate with my hon. and learned Friend the Member for Leicester, West (Mr. Janner) and to see what communication may be made to the House.

Mr. Scott: Has the attention of the Leader of the House been drawn to the terms of Early-Day Motion No. 60, calling attention to the need for a Select Committee on housing? Is he aware that the motion is attracting signatures from all parts of the House? May we expect an early statement on the establishment of such a Committee?

[That a Select Committee be appointed to inquire into housing policy:

That the Committee do consist of twelve Members:

That Mr. A. J. Beith, Mr. Bruce Douglas-Mann, Mr. Robert Hicks, Mr. Stephen Ross, Mr. Nicholas Scott, and Mr. Tom Urwin be Members of the Committee:

That Five be the quorum of the Committee:

That the Committee have power to send for persons, papers and records; to sit notwithstanding any adjournment of the House; to adjourn from place to place; to report from time to time; and to report Minutes of Evidence front time to time:

That the Committee have power to appoint persons to carry out such work relating to the Committee's Order of Reference as the Committee may determine:

That these Orders be Standing Orders of the House until the end of this Parliament.]

Mr. Foot: I note that the motion has the support of hon. Members from various parts of the House. The proposal is certainly interesting, and we must consider it. I commend their concern and their willingness to serve on the Committee, but I suggest that for the present we await the result of the review of housing policy which my right hon. Friend the Secretary of State for


the Environment is proposing to publish. That is not prejudging in any way the proposal that the hon. Gentleman makes in his motion.

Mr. Raphael Tuck: May I press my right hon. Friend on the question asked by the hon. Member for Essex, South-East (Sir B. Braine)? Last week I was informed by my hon. Friend the Minister of State for Overseas Development that the matter of the Banabans and Ocean Island was not for the Attorney-General but for the Secretary of State for Foreign and Commonwealth Affairs. Who will take responsibility for it?

Mr. Foot: As I said, I shall see what is the appropriate way in which communication should be made to the House about this matter.

Mr. Beith: As the Attorney-General is elsewhere laying great stress on his answerability to the House, may we have an opportunity next week to question him by means of a statement in the House on what he has been saying in the courts, so that matters can be clarified for our benefit?

Mr. Speaker: Order. I should have pulled up the Leader of the House. It is a long-standing convention that when a matter is before the courts the House withholds comment on it until the proceedings are over, when our normal procedure is restored.

Mr. Beith: I apologise, Mr. Speaker, for being drawn into that channel.
Will the Leader of the House comment on the suggestion that the Bill to deal with direct elections to the European Parliament might be introduced in another place so that some progress may be made with it?

Mr. Foot: I prefer the hon. Gentleman's first question. I apologise, Mr. Speaker, if I offended in any way in the previous reply I gave. I do not think it would cause offence if I said that the Attorney-General is eager to make a statement to the House on the matter. On the hon. Gentleman's second question about direct elections, I have nothing to add to the comprehensive answer I gave to the right hon. Member for Knutsford (Mr. Davies).

Mr. Nicholas Winterton: The Lord President claims to be concerned about unemployment. As there are problems in the paper and board industry, may I direct his attention to Early-Day Motion No. 74 referring to a Statutory Instrument dealing with import duties on paper, paper board and printed products? Will he give an assurance to the House that time will be found to debate that Statutory Instrument on an early date?

[That an humble Address be presented to Her Majesty, praying that the Import Duties (Quota Relief) (Paper, Paperboard and Printed Products), Order 1976 (S.1., 1976, No. 2116), dated 10th December 1976, a copy of which was laid before this House on 13th December, be annulled.]

Mr. Foot: I cannot give an assurance that it will be debated in the House. My understanding is that it is to be debated upstairs.

Mr. Spearing: Reverting to the rights and privileges of the House, is the Leader of the House aware that because of unforeseen delay it will not be possible to debate upstairs the Import Duties Order concerned with the raising of food tax until it is out of time? Will my right hon. Friend review his undertaking and make sure that we debate the order on the Floor of the House before 2nd February?

Mr. Foot: I acknowledge to my hon. Friend—and to my right hon. Friend the Member for Battersea, North (Mr. Jay) who approached me on the subject—that there has been a misfortune here. There is still no prospect of a debate on the Floor of the House within the praying time and, unfortunately, the committal upstairs was unduly delayed. For that I must take responsibility. We had hoped to be able to make other arrangements to enable a debate to take place. I shall consult my hon. Friend and others who are interested to see how best we can repair the damage.

Mr. Mayhew: Is not the House entitled to know when it can expect a Bill dealing with direct elections? If the Leader of the House is thinking of answering "In due course", when will the course be due?

Mr. Foot: If I could give the hon. and learned Gentleman the first date, I


might be able to give him the second. I have nothing further to add on that subject.

Mr. Mike Thomas: Has my right hon. Friend seen Early-Day Motion No. 113, dealing with the power plant industry, which is in my name and the names of the Chairman of the Northern Group of Labour Members of Parliament and several of my hon. Friends? I do not wish to ask my right hon. Friend to allocate time for debate next week, but if he could find a few moments for one of his right hon. Friends to make an announcement to the House about the Drax B power station, which offers more than 15,000 jobs in the North, that would be welcomed. That matter cannot wait. May we have an announcement soon?

[That this House welcomes the recommendations of the CPRS Report on the power plant industry, and calls for the implementation of the short-term proposal relating to the completion of the Drax power station without further delay.]

Mr. Foot: I fully recognise the anxiety of my hon. Friend and those who work in the power plant manufacturing industry about the need for early decisions on the measures proposed in the report. However, we are bound to honour the commitments made to all the interested parties who asked for consultations with the Government before decisions on the proposals in the report were taken. These consultations are proceeding as quickly as can be arranged. I will convey to the Minister what my hon. Friend says.

Mr. Carlisle: What is the position about broadcasting the proceedings of the House? Am I right in saying that one further debate in the House is required before the BBC can proceed? If so, when is it intended to have that debate?

Mr. Foot: A further debate in the House is required. The report from the Committee concerned will be available soon and that will give the possibility of a debate in the House. We are looking at this matter, and I hope soon to be able to communicate with hon. Members who are specially interested in it.

Mr. Ogden: Is my right hon. Friend satisfied with the rate of progress of the

Scotland and Wales Bill? Is he aware that even some of us who are not particularly enamoured of the Bill would rather see a timetable motion than face the dire prospect of an endless series of Second Reading debates on every possible minor or major amendment?

Mr. Foot: I fully agree with my hon. Friend that we have not made breakneck progress on the Bill. We shall certainly look at the matter, and the considerations which my hon. Friend presents to the House are among those we have to take into account.

Mr. Alexander Fletcher: Does not the Lord President agree that at this time, when the Foreign and Commonwealth Secretary is Chairman of the Council of Ministers, the Lord President and his colleagues on the Front Bench have an added responsibility to introduce the legislation on direct elections?

Mr. Foot: I have nothing to add to the answers I have already given on that subject.

Mr. Radice: May we expect a statement next week on the Bullock Committee's Report?

Mr. Foot: Yes, the report will be published next week and there will be a statement by the Government at the same time.

Mr. Blaker: Does the Leader of the House recall that eight months ago exactly, on 20th May last year, he said explicitly that there would be a debate on foreign affairs in the "coming period"? What did he mean by that?

Mr. Foot: I have studied in Hansard the Question put to me by the hon. Gentleman. The answer lists the dates on which debates took place touching foreign affairs. The general position is as I stated in response to the question asked by the right hon. Lady the Leader of the Opposition. In previous Sessions and previous Parliaments some of the major debates on foreign affairs have taken place because of the selection of particular subjects by the Opposition, for example, during the debate on the Queen's Speech. One reason why there was no general debate during last Session was that no such choice was made by the Opposition.

Mr. Jay: If, unfortunately, we cannot debate the Statutory Instrument on import duties before 1st February, may we at least be assured that the House will have a chance to come to a decision on it before then? It would be profoundly unsatisfactory if there were no discussion of such an important matter.

Mr. Foot: I acknowledge that my right hon. Friend and the House have a grievance. It arises because the House as a whole has not been able to solve the question how to deal with Common Market proposals, legislation and commitments. We must try to seek some escape from the difficulty about the Statutory Instrument referred to by my right hon. Friend. I have undertaken to discuss this with my hon. Friends, but I cannot say exactly what will be the solution.

Mr. Wyn Roberts: When will the Lord President publish the promised referendum clause in the Scotland and Wales Bill? is he aware that some hon. Members who put their faith in the Government's promise are beginning to get embarrassed by his dilatoriness? Will the Lord President at least give a guarantee that the referendum clause will be published before the timetable motion?

Mr. Foot: There is no question of dilatoriness, and there is no reason for the hon. Gentleman or anyone else either in the House or outside to attempt to put any qualification on the Government's undertaking. It was an explicit undertaking. We said that we would put down a new clause dealing with the promise of a referendum. The House will have full opportunity to discuss it. During the course of the debates I said that we were considering whether we could interfere with the arrangements already made for the timetable of the debate so that discussion on the clause might come on earlier. We shall seek to give the House full opportunities to consider and discuss the Government's proposal.

Mr. Mendelson: With reference to the misleading description given by my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden) of the course of the debates so far in Committee on the Scotland and Wales Bill, which he called Second Reading debates, having sat through most of those debates may I point out to my right hon. Friend that

they have been strictly to the point, and that the speeches were not Second Reading speeches but took place strictly on Clause 1, though it was inevitable that they should sometimes have been a little general because the clause was so drafted by the Government as to be declaratory of general principles? I ask my right hon. Friend not to be misled into rushing into a timetable, because those of us who have defended his record against attacks for having abandoned his principles of the defence of free speech will have to change sides if he does so.

Mr. Foot: Not merely do I not expect to be misled by my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden), but I do not expect to be misled by anyone.

Mr. Tebbit: May I revert to the question raised by my hon. Friend the Member for Essex, South-East (Sir B. Braine) about the Banaban people? Will the right hon. Gentleman at least come to the House next Thursday armed with a better excuse than that the Attorney-General is busy for the fact that a Foreign Office Minister has not made a statement? Will he understand that in this matter the Government have the honour of the country in their hands and that it is time that they handled it properly?
Will the right hon. Gentleman further note that there are over 100 signatures to Early-Day Motion No. 67, dealing with the Skytrain? When the Attorney-General does have a few minutes to spare, could he make up his mind whether the Government are to legislate their way out of this trouble or to appeal to another court to try to get themselves out-of the mess?

[That this House welcomes the decisions of both the High Court and the Court of Appeal in favour of Skytrain, calls upon the Government to accept the decision without wasting even more taxpayers' money on further litigation and to stop its campaign against Laker Airways.]

Mr. Foot: We shall make a statement on the Skytrain situation when we have considered what is the best course for dealing with it.
I gave a sympathetic and clear answer to the hon. Member for Essex, South-East (Sir B. Braine) when he raised the question of the Banaban people and I


thought he seemed satisfied with my reply.

Sir Bernard Braine: Sir Bernard Braine indicated dissent.

Mr. Foot: The Government do not intend to be instructed by the hon. Member for Chingford (Mr. Tebbit) about the honour of this country.

Mr. Lee: Will my right hon. Friend get over his surprise when I say that, on the question of the Ocean islanders and Banabans, I find myself in total agreement with the hon. Member for Chingford (Mr. Tebbit), for the first and probably the last time in my life? Is my right hon. Friend aware that this matter is giving grave concern to hon. Members on both sides of the House and that there is a feeling of great injustice to humble people who have behaved with remarkable dignity and forbearance in the face of three-quarters of a century of cumulative injustice?

Mr. Foot: Nothing I have said is intended to disparage the proposition of those hon. Members who have risen to defend the interests of those concerned. Nothing that I have said qualifies that in any way.

Mr. Dudley Smith: Is the right hon. Gentleman aware that the majority of hon. Members are totally unaware that major changes are planned in the size and format of Hansard? In view of the shambles which took place early yesterday morning when the matter was debated, when does the right hon. Gentleman propose to bring this measure back to us? When he does, will he provide far more information about the financing of this operation?

Mr. Foot: Of course this is an important matter. It is a House of Commons matter. What is proposed is on the recommendation of the Services Committee, on which all parties have been represented. I doubt whether we shall be able to have a debate again next week, but I expect that we shall have it in the following week, and we shall seek to give as much information to the House as we can.

Mr. Hugh Jenkins: Does not my right hon. Friend agree that it would be better to get the Scotland and Wales Bill, including, if necessary, a timetable motion and the provision for referenda, out of the

way, together with full consideration of English regional government, before we give time to the question of the European Assembly and direct elections to it?

Mr. Foot: I note my hon. Friend's sense of priorities. We shall weigh it along with the other representations which have been made.

Several Hon. Members: rose—

Mr. Speaker: I shall call two more hon. Members from each side of the House.

Mr. Channon: Does the right hon. Gentleman recognise that his answers on the subject of direct elections to the European Parliament are uncharacteristically vague? Can he at least assure us that he stands by all the pledges in this matter given by the Government in the past, and that there is no change in the policy that he intends to introduce a Bill to enable direct elections to take place at the time agreed by the Government?

Mr. Foot: The hon. Gentleman is aware of the undertakings that the Government have given in references in the Queen's Speech and at other times. When I was asked today whether I had anything to add to those references, I gave the answer that I had nothing to add. There is nothing vague about that. It is perfectly clear.

Mr. Canavan: In view of the public concern about this week's Scottish Office document suggesting the possible closure and merger of certain colleges of education in Scotland, can we have a debate about possible alternative solutions to those contained in that document, including the possibility of a radical reappraisal of the whole of tertiary education in Scotland in order to extend the principles of comprehensive education into the whole field of adult education?

Mr. Foot: There cannot be such a debate next week, for reasons which my hon. Friend will understand, but I am sure that he or other hon. Members will take steps to represent their case to the Minister concerned through one of the courses open to them in Parliament. I am sorry that we cannot find time for a debate, but one of the eventual advantages of devolution will be that many of these subjects will have a better opportunity of debate, and the sooner we can


get the Scotland and Wales Bill on to the statute book the better, for those reasons as for many others.

Mr. David Steel: rose—

Mr. Speaker: I shall call the Leader of the Liberal Party, the right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel). I had not seen him jumping up.

Mr. Steel: I was not jumping up, Mr. Speaker.

Mr. Speaker: In that case, this is unfair in view of what I said earlier.

Mr. Steel: The reason I jump up now, Mr. Speaker, is that I want the Leader of the House to respond more positively about the Banabans. He has not even promised a statement from the Foreign Secretary, which is the least we could expect. Is not the right hon. Gentleman aware that it is a matter of great public concern that this minority has been badly treated?

Mr. Foot: Of course there is great public concern about the matter. I acknowledged that earlier. I will see whether it is advantageous and appropriate to have a statement in the House about it. I cannot give a promise that there will be a statement, but we shall consider the best way of discussion about it.

SUB JUDICE RULE

Mr. Atkinson: On a point of order, Mr. Speaker. May I ask whether you will reconsider the implication of your ruling that it is sub judice to discuss the question of the relationship between the Attorney-General and the judiciary?
I think that the House would concede that there would be a delicacy in raising directly the question of an application before the courts, but I put it to you that there is a world of difference between that situation and the implications of your own ruling or comments today, when you suggest that it is also sub judice for the House to discuss the relationship between the Attorney-General and the judges, because it may well be that in time we shall wish to raise this matter and to debate it in the House.
The point I make is one that I raised on a number of occasions with your predecessor. What you are saying may be correct in relation to this case, which concerns the Post Office, but it is possible that in industrial disputes—for example, in the electricity or gas industries—where points of law are concerned in almost identical situations, in which the Attorney-General or the courts could become involved, it may be necessary for some of us to raise the matter in the House.
I hope, therefore, that what you have said this afternoon about the Post Office situation does not apply to the question of the Attorney-General's relationship with the judges nor, indeed, to the relationship between Parliament and the judiciary, which many of us believe has recently been brought into disrepute as a result of some of the comments which have been made by judges.

Mr. Speaker: Order. The Lord President's comments were directed to a case which is still proceeding, as far as I know. That was why I intervened. We shall look at each case on its merits.
Those who have the honour to belong to this House at this time are the trustees of the unwritten constitution of the land. For centuries this House has adopted the attitude that, when a case is being considered before the court, it will withhold its comments. When the matter has been concluded before the court, this House then expresses its opinion. I hope that I shall have the support of the whole House in maintaining that long-established tradition.

Mr. Atkinson: Further to that point of order, Mr. Speaker. I take it that you are making it clear that in no way did your remarks refer to the relationship between Parliament and the judiciary and that, if we wish to raise issues of that kind, we are free to do so.

Mr. Speaker: My remarks related to the case which is now under way.

QUESTION OF PRIVILEGE

Mr. Skinner: On a point of order, Mr. Speaker. This matter is in some way connected with what you and my hon. Friend the Member for Tottenham (Mr. Atkinson) have been saying.
I raise this matter because, as you have said on many occasions, possible breach of privilege must be brought to your notice straight away.
I assume that most hon. Members received this leaflet in the post this morning. It relates to the case to which reference has just been made between the Attorney-General and the Law Lords. I shall not go into the matter in detail.
This leaflet has been distributed by Aims for Freedom and Enterprise—commonly known as Aims of Industry. It refers to the Attorney-General's statement as being "absolutely unacceptable". I do not suggest that this is prima facie a breach of privilege. That is a matter for you, Mr. Speaker. However, I am advised that it could be either a breach of privilege or contempt of court. I shall not go into the details of the statement. [HON. MEMBERS: "Read it."] I leave that in your hands. On the basis that it is necessary to draw it to your attention, if it is in fact a breach of privilege, it is perhaps as well that you should hear the contents.
Attorney-General's statement 'absolutely unacceptable' states AIMS.
That is Aims for Freedom and Enterprise.
'Absolutely unacceptable' is the verdict of Aims for Freedom and Enterprise on Attorney-General Sam Silkin's attack on appeal court judges today.
Speaking for 3,000 companies and federations, Aims Director Michael Ivens said 'It is many hundreds of years since there has been such a blatent assault'"—
"blatant" is wrongly spelled with one "a" and one "e" instead of two "a's"—
'by a politician on the legal processes of this country. The fact that it has been offered by a weak and shillying Minister does not make it less offensive.'

You will appreciate the remarks in that sentence, Mr. Speaker.
'We have now reached the stage when tuppence-ha'penny politicians feel they can ride roughshod over any inconvenient laws, especially is those laws'"—
presumably that should be "as those laws"—
'affect their paymasters, the trade unions.
Britain has now arrived at the stage when it must have a Bill of Rights, and that very quickly indeed.'
Further information: Peter Thompson—Office"—
and it gives two telephone numbers. 
That is the circular which Members of Parliament have received this morning. I raise this matter because I am advised that it could be either a breach of privilege or contempt of court. For that reason, I think that you should look at it, Mr. Speaker.

Mr. Speaker: Following the general practice, by leave of the House, I shall give my reply tomorrow.

BALLOT FOR NOTICES OF MOTIONS FOR MONDAY 7TH FEBRUARY

Members successful in the Ballot were:

Mr. Hugh Dykes
Mr. Kenneth Warren
Mr. Tim Sainsbury

STATUTORY INSTRUMENTS, &c.

Ordered,
That the draft Asian Development Bank (Extension of Limit on Guarantees) Order 1977 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Snape.]

Orders of the Day — TRANSPORT (FINANCIAL PROVISIONS) BILL

Order for Second Reading read.

4.5 p.m.

The Secretary of State for Transport (Mr. William Rodgers): I beg to move, That the Bill be now read a Second time.
Later today—and as soon as possible, I hope—we shall turn to a wide-ranging debate on transport matters. In a sense, we are taking the discussion the wrong way round. I understand why this order of business suits the convenience of Members. But, in turn, I hope that it will be understood if I limit myself more closely to the substance of this Bill than a Second Reading might otherwise justify. In any case, a short debate requires at least a shortish speech from the Minister if other Members are to have a fair chance to intervene. Matters of detail will be appropriate to the Committee stage.
I shall be focusing in our further debate on the White Paper that I hope to publish later this year. That will look to the future. This Bill, on the other hand, is simply a step to keep some of the present arrangements working until we have reached and implemented any changes that may prove necessary.
The transport element is concerned with powers to support losses by the British Railways Board and the National Freight Corporation. Such grants are already being paid on the authority of the Appropriation Act. It has, however, been the practice of the House to provide specific authority for grants of this kind, and the Bill does precisely that.
When my right hon. Friend the Member for Sheffield, Park (Mr. Mulley) recommended what is now the Railways Act 1974 to the House, he said that he did not claim that the arrangements then introduced would prove a lasting solution to the railway problem. Nevertheless, they represented a step forward. One result of those arrangements was that the costs imposed on the railway by the rail freight and passenger businesses were separately identified in a new way of which I think the House approved at the

time. The expectation was that the rail freight business on this new basis would be able to break even.
Unfortunately, that turned out to be optimistic and the delayed effects of price restraint, increases in costs and the recession in the economy so combined that in 1975 the rail freight business proved to be incurring a substantial deficit. There was no statutory provision for meeting that deficit which was threatening to undermine the Board's finances.
The Board took short-term measures. But it was clear that, in order to establish the rail freight business upon a firm basis and to give it an assured future, further examination of the whole underlying strategy was needed. This was developed as the fundamental review of the rail freight business described in Chapter 8 of the transport consultation document which will be the basis for debate later today. The Government meanwhile announced in July 1975 support not exceeding £70 million for that year and last February a further grant of up to £60 million for 1976. At the same time the Board was asked to make substantial progress towards phasing out the deficit during 1976 and 1977.
Those who have been involved with transport matters over the years know that the rail freight business is heavily dependent for traffic on the heavy industries, such as coal and steel, which are the most severely affected by a recession. But, with the co-operation of the unions, the Board has been able significantly to reduce its costs while, by careful marketing, it has been able to increase its revenue substantially. It has also been able to win much larger carryings of coal and steel than expected. I am now glad to say that the Board has managed to contain its requirement for grant in 1976 to some £40 million, subject to completion of audit.
This is progress in the right direction. I would add that the recent changes I have made in the structure of the Board —and I might say something further about this later this evening and the House may wish to comment then—should help to reinforce the quality of management further by bringing the Board into direct responsibility for marketing and operation of the rail freight business.
I come to Clause 1 of the Bill. As I have said, decisions on the future of freight strategy depend, among other things, on the outcome of the transport policy review, as it is called—a description that I have inherited. The review resulted in the consultation document and it will result, in due course, in my own White Paper. All that Clause 1 provides, therefore, is specific statutory authority for the grant in 1977. Authority for grant currently in payment already exists in last summer's Appropriation Act. The clause identifies the terms and conditions of the remaining payments and enables me, with Treasury agreement, to provide a total amount not exceeding £45 million.
As for the grant in respect of 1977, this ceiling is consistent with the provision of £30 million envisaged in the last White Paper on public expenditure, Cmnd. 6393. The remaining £15 million—which hon. Members may notice is authorised in Clause 1 and makes up the total of £45 million—is needed because of differences between the rate at which support accrues and the timing of actual payments to the Board.
These are technical matters familiar to those who are aware of the problems of company accounts. The precise amount due for 1975 and 1976 will emerge only when the grant audits now in progress have been completed. The sums which the Department has retained against possible adjustments will then be paid over and will fall within the scope of the Bill. To sum up, the provisions of Clause 1 are intended to do no more than reflect the decisions already taken on transitional support for rail freight, which have, of course, quite properly been reported to the House.
I now turn to Clause 2, which provides authority for grants to the National Freight Corporation. The NFC has been receiving grant since last January. Clause 2 fulfils the undertaking given in August by my hon. Friend the Member for Dudley, East (Dr. Gilbert) to seek as soon as possible specific statutory authority for these grants.

Mr. Norman Fowler: Will the Minister say exactly how much has been provided in grant for the NFC since January 1976?

Mr. Rodgers: I hope to do so in the course of my further remarks. Otherwise I shall seek to answer the point at a convenient time.
First I want to say a word or two about the circumstances which, although familiar to the House, deserve repetition on such an occasion as this and to indicate how the problems arose that led to the statement of my hon. Friend the Member for Dudley, East.
The NFC's financial problems stem largely from the difficulties experienced by two of its subsidiaries—National Carriers Limited and Freightliners Limited. Both these companies were part of British Rail before 1968. Like rail freight, both have been badly hit by the combined effects of the recession in the economy and the effect of inflation.
Another problem in 1976—and I remember that the hon. Member for Sutton Coldfield (Mr. Fowler) discussed this matter in the debate that we had earlier this year—was the Corporation's European subsidiaries. Here the NFC quite properly took a business risk. I say quite properly not only because the NFC has the statutory authority to acquire companies but because it is entirely right that it should have the same freedom as its private sector competitors to take commercial opportunities as they arise.
The essence of the strategy was to bring together and rationalise existing companies. But the recession in Europe—and again this was discussed in the House earlier this year—affected the whole operation and the oil crisis in particular affected the two largest French companies in the tank haulage business. Early in 1976 the NFC decided that the time, money and effort needed to carry through the European strategy could not be justified—again a decision that it made quite properly—and that the right course was to close or sell the loss-making subsidiaries.

Mr. Nicholas Ridley: The Minister said that he thought the NFC should be free to engage in such venture activities. Does he still think so after this experience?

Mr. Rodgers: Yes, I certainly do. The NFC has statutory obligations, but it also has rights that have been set down in


legislation by the House. While I believe strongly in a mixed economy, I think it is also right that the public sector, within reasonable constraints laid down by Parliament, should have the opportunity to take risks. Sometimes risks succeed and sometimes they do not, but I see no reason why the public sector should be inhibited in that way.
The NFC, although no doubt wiser as a result of its experience, should not be inhibited in the exercise of its business judgment. This is an area where the House is right to discuss policy and strategy but should support the management of public corporations, once they have been appointed, in carrying out day-to-day responsibilities and seizing opportunities when they exist.

Mr. A. P. Costain: I have received representations from trade unions in my constituency suggesting that the shipping side, which is making a loss, should be sold off and given to more profitable private enterprise shipping companies. Does the Bill give any power for us to insist on that happening?

Mr. Rodgers: I am not sure whether the hon. Member is referring to the National Freight Corporation, which I was not aware had any shipping subsidiaries. British Rail would say that its shipping subsidiaries were a worthwhile part of its business. We shall not provide solutions to the problems of British Rail and the NFC by unnecessary restrictions or by any attempt to break up two important businesses that can serve the nation well.

Mr. John Farr: Does the Minister agree that a proper way in which the NFC could display its interest would be by encouraging the development of a large commercial hovercraft of the type whose development the French Government have piloted and that is about to enter into service in the Channel? Is there not a risk that we are in danger of losing our pre-eminent position in the hovercraft industry because of a lack of Government enthusiasm?

Mr. Rodgers: I am most grateful to the hon. Member for drawing my attention to that point. I have sympathy with the view that this country has often

advanced technological developments on which the initial steps have been taken and has then failed to exploit them commercially. Whether this is a subject in which the NFC can interest itself I am not sure, but I shall direct it to the NFC's attention and consider, in the light of statute, whether it would be a proper matter for its consideration. I am grateful to the hon. Member because he has brought out a point that I had not expected to make.
Of course we must expect successes and failures in public corporations to be a matter for debate in the House, but we should not ignore the way in which public corporations push forward frontiers and set improved standards. The NFC has provided an important means of management training for employees who have then gone out into the private sector to play an important part in its prosperity. It is proper and desirable that such people should not be restricted. Let us recognise the extent to which the public sector can make a contribution.

Mr. Stephen Ross: I want to express thanks to British Rail and to the Minister's predecessor. In my constituency we are competing with the French hovercraft that has just been mentioned. We are stretching the British SRN4 hovercraft and we shall be in competition with the French this summer. Although we have left it a little late, we are now catching up.

Mr. Rodgers: The hon. Gentleman has been typically generous. His remarks will be noted by the House and appreciated by British Rail. The House will not wish to be less generous than the hon. Member in recognising the problems. I am not seeking to minimise the problems in the continental operations of Freightliners Ltd. and NCL. They add up to about one-third of the NFC's business.
The bulk of the business—United Kingdom road haulage and associated companies—could have weathered the difficulties of 1974 and 1975. The Corporation should be given full credit for that, though we should not minimise the problems that it still faces. There is, however, an important, profitable and successful part of its business.
The overall position clearly called for vigorous management action. I am sure


that the chairman and the Board would not deny that there were lessons to be learned and a need to improve the immediate position and to look at the structure and strategy of the Corporation. I am glad and I am sure that the House will be glad that the measures taken by the Corporation have brought about a considerable improvement. The Board has been helped by the full co-operation which the management has received from the trade unions.
The NFC as a whole is now expected to record a trading profit of about £4 million in 1976 compared with a trading loss of £7 million for its United Kingdom companies in 1975. The picture for some of the NFC's major activities, notably the BRS group, which had another encouraging year, and Pickfords heavy haulage, is encouraging.
However, when overheads and interest charges are taken into account, the NFC will still have a total loss for 1976. The grant paid so far is £22 million and the loss in 1976 is likely to be about £16 million. I do not seek to dismiss this as insignificant, but we should bear in mind that the loss in the previous year was £31 million, and that indicates how quickly the business is being turned round. Clearly, further cash support will be needed and Clause 2 therefore provides additional transitional support within the limit of £50 million.

Mr. Michael McNair-Wilson: The Secretary of State has given some optimistic figures about the Corporation, but can he say whether Freightliners Ltd. shows any sign of breaking even?

Mr. Rodgers: There has been a considerable improvement in Freightliners and the NCL, though it would be wrong to say that in their different ways they do not represent awkward problems. Freightliners Limited presents a different case and the handling of small parcels is a problem which confronts everyone. We have to consider it in terms of the service provided and the need for Freightliners to pay its way. However, there have been improvements in these sectors and I am grateful to the hon. Gentleman for enabling me to put that on the record.
Grants provide only a temporary respite. I am not prepared to rest on the improvement we have seen, welcome

though that is, or on the provisions of the Bill. I am currently examining not only the results of the consultants' review, but the NFC's own corporate plan, which I received last month.
I do not wish to exaggerate the extent to which it is easy for any business of this kind to produce a corporate plan to stand the test of time, but this is a move in the right direction and a promising indication of the responsible way in which the Board and the Corporation are facing their longer-term problems.
My hon. Friends will be pleased to hear that I am also examining the Corporation's claim that its inherited interest and pension liabilities are a burden that puts it at a disadvantage against its competitors.
There are problems in deciding where the burden should properly lie, but I was grateful to have these problems drawn to my attention at a recent Question Time. They are a factor that must go into the equation in any assessment of how the Corporation has performed. In addition, I am considering how further appointments to the NFC Board from among those with successful careers in executive rôle with the Corporation might strengthen it and add to the invaluable experience of the part-time members.
These are important steps that will yield results and in the meantime the grant authorised by the Bill should be sufficient to meet the NFC's cash requirements until we can see measures put into effect to achieve long-term stability. Most of the improved results in 1976 were brought about by carrying the same volume of traffic at reduced cost rather than by winning new traffic—a desperately difficult task in a fiercely competitive market. However, the fact that the same volume of traffic could be carried at reduced cost indicates an improvement in efficiency, which the House should welcome.
We have also had to require the NFC to restrict its investment in 1977–78 to an amount that, with its need for grant support, will not exceed the amount provided for in last year's public expenditure White Paper as reduced following the Chancellor's statement on 22nd July. This requirement was necessary to achieve the aim, set out in the Explanatory and Financial Memorandum to the Bill, that the resources required for the


grant will be found within the public expenditure totals envisaged in the White Paper.
Neither Clause 1 nor Clause 2 offers open-ended subsidies; these are transitional grants. Nothing I have heard since taking up my present office in September has led me to see a justification for long-term subsidies to any mode of freight transport. I intend to move accordingly and I know that I shall have the support of the Boards of the two industries concerned. I would not recommend the Bill to the House on any other terms. I am confident that we are moving in the right direction and without delay.

Mr. Ian Gow: So that the House may be quite clear what the right hon. Gentleman is saying, will he explicitly compare like with like? After all interest payments, the loss of the Corporation for the year ending 31st December 1975 was just under £31 million. We appreciate that the figures are not finally available, but what is the estimated loss after all charges for the year ending 31st December 1976?

Mr. Rodgers: I gave the figure earlier. It is about £16 million. Compared with £31 million, it shows a considerable improvement, though there is some way to go.
I hope that hon. Members will address comments and criticisms to Ministers and not to those, whether in management or trade unions, who have made a considerable improvement in the Corporation's position in the past year.
Clause 3 deals with waterways. These are not my ministerial responsibility, but the provisions fit in conveniently with the rest of the Bill. My hon. Friend the Under-Secretary of State for the Environment will be replying to the debate. Apart from his great knowledge and responsibilities in his new Department, he was previously in what is now the Department of Transport and is qualified to comment on all aspects of the Bill.
The House knows that the Government have decided that it makes more sense to treat the waterways as part of the water industry than as part of the transport industry. In the Green Paper published in March 1976 the Government

put forward the proposal that the Board should be merged with the new National Water Authority. Response to that Green Paper is still under consideration and a White Paper will be published before long.
In the meantime Clause 3 is a technical provision needed to continue the present arrangements a little longer. Since the Board has a deficit on revenue account which is met by a grant, and since there is little by way of depreciation on its heavily written-down assets, it needs to borrow from the National Loans Fund for its capital expenditure. The limit on its borrowing was set in 1968 and will shortly be reached. As an interim measure, therefore, we propose to raise the limit by £8 million, which should serve for the time being.
The Bill is a modest if not a necessarily very welcome measure to ensure that three public bodies are able to continue their work while we reach and implement decisions about the way in which they should develop. It does not raise new or difficult issues and there will be an opportunity later today to debate the broad issues raised by Clauses 1 and 2. I commend the Bill to the House and I hope that the House will find it worthy of support.

4.32 p.m.

Mr. Norman Fowler: The Bill is basically concerned with subsidising the freight operations of the National Freight Corporation and British Rail. My hon. Friend the Member for Faversham (Mr. Moate) will deal later with the British Waterways aspects of the Bill.
The first question is one of principle. Is there any justification for a freight subsidy to subsidise not passenger movements but the movement of goods? Our emphatic view is that there is no such justification—either for subsidising rail freight or, and I emphasise this, for subsiding road freight. In case there is any doubt I must make clear that that is also the declared position of the Government, and we have just heard the right hon. Gentleman repeat it. The right hon. Member for Grimsby (Mr. Crosland) made the position clear in his consultation document, which we debate next, when he said that there is no social or environmental reason for a freight subsidy. When the


right hon. Member for Stepney and Poplar (Mr. Shore) became Secretary of State that policy appeared to change. But now the Secretary of State has returned at least by declaration to the original policy, although it appears to be a policy of "Make me good, O Lord, but not yet".
The Bill provides for freight subsidies of up to £95 million. The House is being asked on the basis of a minimum of information to vote that money and, in the case of the National Freight Corporation, we are not even told where the money will cone from; whether there will have to be offsetting savings to keep us within public expenditure limits; and, if so, where such savings come from.
Let us first consider the freight operations of British Rail. In July 1975 the then Minister of Transport bravely and openly set out his policy in a Written Answer. He said that he was making a grant to meet the estimated loss of British Rail freight operations. In 1975 the loss was £67 million and in 1976 £40 million. So, over the last two years there has been a total loss of over £100 million. In addition to that we should always remember—and this is also from information contained in the Government's consultation document—that freight operations are already treated favourably within British Rail's accounting system. When freight operations share lines with passenger services the passenger side meets the cost. They pay only their track costs on freight-only lines.
The case that I want to put on British Rail freight is even more fundamental. It concerns how British Rail shares its costs. We have raised before the question of the absence of any breakdown of costs in British Rail services. We know that costs of separate services are not kept. Not only is that inadequate but there are considerable doubts about whether costs are accurately shared between the passenger and freight business. The problem in this country may be more of a freight problem than is shown by the accounts and therefore less of a passenger problem.
I shall seek to set up the position between 1964 and 1974 as shown by the figures in the consultation document and the annual reports of British Rail. The position that the figures appear to reveal is that over the 10 years from 1964 to 1974 British Rail made considerable savings

and improvements in efficiency. There is no doubt of that, and British Rail and its staff have received insufficient credit for those improvements in productivity and efficiency. However, the worrying question is whether too much of these savings has been credited to the freight business side rather than the passenger business side. If this is the case, the impact on the railway debate is important. It means that the passenger side has not received its fair benefit. It means that rather than subsidising the passenger services to the extent shown in the accounts, we have been subsidising freight operations to a far greater extent than shown.
Let us examine the figures from 1964 to 1974. There was a dramatic reduction in staff from 380,000 to about 210,000 on mid-year figures. That accounts for a saving of about £450 million in staff costs and probably a true saving of about £500 million. We can probably agree that that was an important saving.
Let us now examine the costs. Using the figures in the consultation document and subtracting the London Transport passenger element one finds that the cost of the railway passenger service rose from £200 million in 1964 to just over £600 million in 1974. In other words—in spite of economies—the cost of the passenger business rose by over three times.
But now let us compare the cost of the rail freight business. The costs of that increased from £340 million in 1964 to £380 million in 1974. So on the freight side there was an increase of only 12 per cent.—with only a small fall in traffic.
The consultation document asks us to accept that in the period 1964 to 1974 the average cost of railway passenger travel rose from 0·60p per kilometre to 2·0p per kilometre. In the same period the average cost per tonne of rail freight only rose from 0·90p per tonne to 1·10p per tonne. In the same period, incidentally, the cost of road freight is shown as having increased by three times.
We know about the favourable accounting treatment that British Rail receives on track and signalling costs and there have been important improvements in productivity. But the position shown by the figures can be explained only if virtually all the savings over the last decade were on the freight side. But


patently that has not been the case. In the last ten years there has been an improvement in passenger train speed of 46 per cent. Passengers per train-hour went up by 51 per cent. The number of passenger stations was reduced by 34 per cent. The figures suggest a number of important implications.
The railway industry tends to be judged by the public in passenger terms. It is, therefore, portrayed as woefully inadequate on achievement, because it appears that whatever is done, all that happens is that fares and subsidies go up. But it may be that we are considerably understating the achievement of the passenger side. Of course, for the passengers the effect is also of fundamental importance, because if the passenger side should be credited with more, it follows that the passenger subsidy is currently being overstated.
Once more it makes the point that British Rail really must produce accounts which we here can use as a reliable guide to policy making. Its current accounts do not provide such a guide, and indeed, they appear to mis-state the position. Frankly, we do not know what the true freight deficit is, yet we have been asked to vote on the principle of supporting it. That is obviously a position to which we shall wish to return time and again in Committee. However, let me say on Second Reading, that I should like some guidance from the Government on the figures that the Government are publishing.
The position is already bad, but next let us take the National Freight Corporation. The announcement of a freight grant for the NFC was again courageously made in Written Answer on 21st January 1976. The then Minister said that because of the economic recession, the NFC expected in 1975 to make a loss of £30 million. He said that therefore the Government were making available an immediate grant of £8 million. Now, in addition we have discovered that during the last 12 months he has also made available grants totalling £15 million, so as to make a global total for the year, as I understand it, of £23 million—£15 million and £8 million.
In addition to this, however, we have now this Bill, which basically provides for £50 million-worth of losses to be

paid out for liabilities after 1st January, 1977. In addition to that we are told that a reorganisation, or restructuring, is also taking place. Therefore, in that case it may well be that the Government will come to the House again for further money.
That, then, is the position with which we are being presented. Therefore, in considering this proposal from the Government, we shall want to look back over the immediate past three or four years.
During 1975 the NFC had a record loss. There is no question about that. Last year that loss was reduced from £31 million to £15 million. Clearly, we on the Opposition side of the House totally welcome that improvement. The Secretary of State will forgive us if we are not altogether taken by surprise. The NFC public relations machine has been working overtime in the last few weeks. A number of my hon. Friends have been enjoying its hospitality—to such an extent that I thought that the NFC had actually joined the catering business.

Mr. Ridley: Name them.

Mr. Fowler: Then, at the weekend, transport circles in Fleet Street—I think that would be the best way of describing them—reached a sudden unanimity that better figures were on the way. The Times "believed" it, the Financial Times "expected" it, and The Guardian "forecast" it. Remarkably they all had the same figures that were disclosed—if that is the right word—by the right hon. Gentleman today.
Let me say, however, that even within those totals we are still talking about a £15 million loss, and we are still talking about National Carriers, which is apparently still making a loss of £5 million. If the Financial Times is right, for the first time since 1957 Roadline—which was previously BRS Parcels—has made a loss. We shall certainly expect the Under-Secretary to say something about that in his summing-up.
Obviously the future prospects of NFC are considerably relevant in this debate; but so, too, I suggest, is the past performance. I would suggest that a consideration of the NFC record over the last few years is not only of importance but is essential for evaluating its plans and its estimates for the future.
It is beyond argument, as I have said, that in 1975 the NFC made a record loss. I am conscious that in any analysis of that performance I could be vulnerable to the charge of being wise after the event, so I should like to go back to the report of 23rd October 1973 of the Select Committee on Nationalised Industries. There we find a marked contrast in approach. On one side we have the NFC bullish and optimistic. On the other side we have the more cautious approach of the Select Committee.
In its evidence, the NFC described its plans and then set out its commercial philosophy. What it said was this:
None of these plans will prevail if we live in a world of subsidy, especially if this only serves to cushion and protect inefficiencies, overlaps, obsolescent practices and weak management.
The NFC added,
We seek to be judged by the same criteria as private industry. We can then aim to be the pacemakers in environmental and social matters through our commercial success.
That was what was said to the Select Committee in October, 1973. 
The return on capital was estimated to rise from 11·3 per cent. in 1973 to 14·5 per cent. in 1975—the year of the record loss. When questioned, the chairman disagreed that such forecasts were over-optimistic. Let me add that, as far as I can see—and I have gone through all the evidence—at no stage in this inquiry did the NFC mention capital reconstruction, pensions or free fares for ex-British Rail staff. 
In contrast, the Select Committee was decidedly more cautious in its expectations and it proposed two fundamentally important measures—a plan to eliminate the losses of National Carriers, and a proposal to sort out the muddle in the publicly-owned parcel carrying business. 
In August 1974, the Secretary of State for the Environment, then the right hon. Member for Grimsby, replied. First of all, he said that the Government noted that "an enterprising start" had been made in developing European activities. "Enterprising", I think, was a word that the right hon. Gentleman used today. It is certainly one way of describing what was happening at that time, for, although this development was too late for the Select Comimittee, at the end of 1974 the NFC completed the purchase of a

number of French companies. A report of this was contained in the January 1975 issue of Motor Transport, and referred to in the 1974 annual report. All told, the NFC bought five road haulage companies concentrating on the bulk transport of petroleum and chemical products. It involved a fleet of 600 vehicles. 
The result of this venture was shown in the 1975 annual report, which said,
It is perhaps fortunate that the experience was gained in a comparatively short time scale and decisive action has been possible to contain the position.
Although it may not be immediately apparent from those words, the decisive action referred to was that the business was closed down. The only question is, what was the loss that was involved here? In the 1975 report of the NFC, the costs of closure are estimated at £5 million. But that is only part of the story, because at November 1975 the subsidiaries had a trading loss of £6·4 million, so we are talking already in terms of a loss of £11 million. In addition, it again appears from the accounts that £2·6 million was written off for the acquisition of goodwill in 1974. So now we have a total loss of between £13 million and £14 million on this French venture. 
Therefore, what we clearly want to know from the Minister—and what was totally absent, and noticeable as such, from the Secretary of State's speech—is what is the current estimate of the loss from this French venture? The fact is that on the figures before us, one of the biggest losses in 1975 had nothing to do with pensions, free travel or even the parcels industry. It came directly from a disastrous entry into the French market. Obviously we want that information, because, frankly, I see no reason why the British taxpayer should be asked to fork out millions of pounds in this way. Also, I do not regard it as one of the tasks of the National Freight Corporation to rationalise the petrochemical market of France. I do not think that that is included within its terms of rationalisation, particularly when there is enough rationalisation to be done at home. 
That brings us to the major point made by the Select Committee, namely, that operations between National Carriers and Roadline should be rationalised, and, if it proved impossible to make National


Carriers a profit-making enterprise, its complete integration with Roadline should be considered. 
In response to that suggestion from the Select Committee, the Government said in August 1974 that they accepted the judgment of the National Freight Corporation that National Carriers should be given a further opportunity to continue the trend towards profitability as a separate organisation. But in 1975 National Carriers lost £10 million. 
A further major point made by the Select Committee was that the public sector parcels business was in a mess, that the National Freight Corporation, British Rail and the Post Office were all in the same market, and the characteristic result was loss for all concerned. As Sir Richard Marsh said, with some understatement, in evidence to the Select Committee there can be no doubt that the three public sector organisations are
producing a less than optimum result for the taxpayers.
Sensibly enough, the Select Committee urged that there should be an inquiry into the operation of the public sector parcels service as a matter of urgency. Back came the Government's inspiring reply:
Because of the complexity of the issues concerned, the Government are not yet in a position to reply substantively to this recommendation of the Committee".
That was in August 1974, and I suppose that rocking the boat was not considered a good idea at that stage.

Mr. John Prescott: As a member of that Select Committee, I consider that the hon. Member is quoting very selectively from the report and conclusions of the Committee. When investigating that matter, we were concerned to press upon the Government of that time, the Tory Government, that they should consider putting the three nationalised organisations together and to make a decision as to which one should carry the parcels traffic. That was avoided by the Government of the time, who refused to intervene.

Mr. Fowler: It is true that the Select Committee made its report in October 1973, and although I am prepared to accept full responsibility on behalf of that Government—of which I was not a member—for the two or three months

that we remained in power, that was the response from the Government. I do not want to make any particular point about it. But the problem was well known, and whether it was a Conservative Government or a Labour Government in office, action should have been taken sooner.
Lastly, I make three points about the National Freight Corporation. It is clear that the NFC has made some totally wrong decisions. Let us be blunt. Its entry into France was a disaster. There is no question about it or excuse for it, and only slowly, bit by bit, is the full extent of the loss becoming clear. It lost millions of pounds. It caused dispute with the French trade unions, and, according to those who know the position there, it has had a bad effect on the reputation of British operators generally. It had totally the opposite effect of what was planned. Nor could anyone conceivably be happy with the Secretary of State's attitude on this question, because it seems from what he said that he is quite happy that such a venture should take place all over again.
Second, the judgment of the NFC, set out for all to see in the 1973 Select Committee Report, has been proved wrong. It may have a case on pensions, although it was not stated then, and in any event its position could have been eased had it not gone ahead in France. Surely, the Minister for Transport, who announced in 1976 that the NFC was facing difficulties because of inflation and recession, could not have believed that the NFC was the only company in this country suffering from the effects of inflation and recession. What the NFC has to explain is why it could not cope when its nearest equivalent in the private sector, the Transport Development Group, continued to be profitable. Moreover, when private sector companies encounter difficulties they are sometimes forced to realise assets. There is an example of one major company doing that at the moment. Has the NFC even considered doing it—perhaps with its cold storage company—and if not, why not?
Third, the Government, faced with that situation and the losses of National Carriers, should have acted sooner. The evidence has been here since the Select Committee Report of 1973, and the Government have served no one by their failure to recognise it. We shall


recognise it now. I do not think that the Government, the NFC or British Rail have made out a case for freight grants, either in practice or in principle, and I urge my hon. Friends to vote against the Bill.

4.55 p.m.

Mr. Tom Bradley: At the outset, I declare an interest in that, until very recently, I was president of the Transport Salaried Staffs Association and I am now the acting general secretary of that trade union. To that extent, I have to represent the interests of thousands of members who have invested their lives in the organisations which we are discussing on this measure.
The hon. Member for Sutton Coldfield (Mr. Fowler) spent a large part of his time attacking the management of the National Freight Corporation. As one who from time to time has to negotiate with that body, I must say that the management of the NFC and its subsidiaries does not deserves the hon. Gentleman's strictures. The managers have the welfare of the industry for which they are responsible very much at heart and are making considerable progress, as I shall demonstrate.
The two principal State corporations which we are discussing share something important in common in matters of finance. Both British Rail and the National Freight Corporation are expected to show big reductions in their losses last year when the figures are published. I shall deal first with British Rail. Big strides have been taken by British Rail management towards eliminating Government support for its freight business in the last three years.
When we discuss British Rail's freight activities and operations, we must not overlook how closely British Rail freight movements are linked with the heavy basic industries of this country, such as coal and steel. It was no coincidence that when, in 1975, steel ingot production was the lowest for 25 years, this was reflected in the accounts of British Rail.
On the specific question of British Rail's accounts, I agree with what was said by the hon. Member for Sutton Coldfield. A great deal of clarification is needed in the presentation of the railway accounts, because they are very hard to follow, and I support 100 per cent. the

request made by the hon. Gentleman in that connection.
The recession in the iron and steel industry in 1975 was one of the principal reasons why the Government's support for British Rail's freight operations reached £67 million. For last year, we are told, the requirement will be much lower, between £40 million and £45 million, and I believe that there is every prospect that in the current year, 1977, British Rail will keep below the previously published Government intention to have a limit of £30 million.
At a time of national economic recession these are noteworthy achievements, when British Rail and all other operators are fighting for every ton of traffic. In the case of British Rail, it is the result of better marketing efforts, a stronger pricing policy and an improved and more intelligent use of resources. The introduction of a modern national air-braked merchandise service will improve still further the prospect of British Rail.
The hon. Member for Sutton Coldfield raised the important question whether it was right in principle to subsidise freight operations. I believe that it is equally relevant to look at the payments in support of freight operations in the context of the statement in the consultative document that no fewer than 150,000 heavy goods vehicles did not meet their costs to our road system to the extent of over £130 million last year. If we are to engage in arguments about subsidy, we must take account of that kind of estimate.
I appreciate that in this debate we are not very much concerned with passenger activities on British Rail, but we are aware that likely support in that area will amount to £20 million below the limits set by the Government, and certainly below the 1975 level. That is no mean achievement when it is set against the background of the inflationary period through which we have passed.
I want to say how pleased the trade unions are with the new Chairman of British Rail, Peter Parker. I have seen many chairmen of British Rail and of the British Transport Commission come and go, and indeed I go back to Sir Brian Robertson's days in office. I believe that Peter Parker has brought a positive and


purposeful outlook to his job. He believes in the expansion of rail freight and passenger operations, and I think that he commands the confidence of the work force in British Rail to a degree that has not operated with chairmen for many years. The morale of railwaymen has not been high for some time and in my judgment Peter Parker is bringing new standards, a new approach and a refreshing outlook into a difficult industry that is competing in a highly competitive market.
I now turn to the National Freight Corporation, which played a prominent part in the remarks of the hon. Member for Sutton Coldfield. The Corporation was set up under the Transport Act 1968. Many of us at that time doubted whether that was a wise thing to do, but when it came into operation many thousands of former railway employees suddenly found themselves, at the stroke of the legislative pen, with a new employer. That meant for the trade unions a whole set of new negotiations on service, pensions and all the rest of it. Management, too, found that it had to take on new obligations. I shall say a few words about pensions a little later in my remarks.
The problems of the NFC relate principally to two subsidiaries, Freightliners and National Carriers Limited. The Freightliner business is going very strongly indeed. Last year it was the only NFC organisation that increased its business substantially, and it did so against the transport trends in 1976. It has turned a loss of £1 million into a profit of £1·3 million in 1976. Expressed in another way, in real terms, the number of containers conveyed by the Freightliner organisation last year was 730,000 compared with 624,000 in 1975. This should be compared with a figure of 30,000 containers when the organisation was set up in 1966. Obviously it is a business with a future, but it requires new investment at transhipment points, and many terminals require resiting.
Many of us believe, and we have said so publicly, that Freightliners should be returned to British Rail. I am still of that view, but I appreciate that it is a matter for the Minister. Whether or not it is returned to British Rail, I am sure that its employees under the present

management can have every confidence in the future as a result of the new marketing techniques adopted and the number of new contracts achieved.
I gather from the Press that the NFC had a final loss last year of about £15 million, compared with an overall loss of £31 million in 1975. I am talking not about trading losses but about overall losses, taking account of factors such as interest. When we consider that of the overall loss of £15 million predicted for last year a figure of £16·7 million is attributable to one concern, namely, National Carriers Limited, we can see that but for that factor the National Freight Corporation would be in the black.
If we examine the trading basis alone, it is in the black because a loss of £10 million in 1975 in trading terms was converted into a profit of £4 million last year. I concede at once that this is nothing like enough to cover future investment requirements. That is why the capitalisation of the NFC requires urgent attention.
I am sorry that my right hon. Friend was unable to enlighten us a little further on his thinking in this connection. At the time of the takeover of sundries traffic from British Rail in 1969, the NFC inherited from British Rail not just an annual deficit of over £20 million in its current accounts, but also an historic burden of capital debt.
To return to the current trading position, we should appreciate the degree of rationalisation that has taken place from the point of view of those in National Carriers Limited, and we must also appreciate the extent of the staff co-operation provided under the new management. In 1969 in National Carriers Limited there were 250 local depots employing 24,500 staff and utilising 9,000 vehicles. That figure is now down to fewer than 100 depots with 14,000 staff utilising 6,800 vehicles. In other words, 12,000 staff in NCL have gone out of the business and nearly all with redundancy payments. That has cost the NFC between £40 million and £50 million. The 14,000 staff remaining in NCL are now working hard to get things right for their company.
After a set-back in 1975—which was a bad year for the small parcels business, because the level of trading activity in


the country as a whole has a severe impact on that form of operation—the company has resumed the improving trend that began in 1969. It cut its trading loss from £10 million in 1975 to a figure under £5 million last year. Here again, the emphasis is being laid on new marketing policies. A nationwide, blanket service is giving way to specialised flows of traffic geared to inter-city routes, and more and more manufacturers are committing themselves to NCL.
I know that the Corporation considers the drain on its resources arising from the pension liabilities that it inherited from British Railways in 1969 to be a serious injustice. The Corporation, partly responsible for Freightliners and wholly responsible for the old sundries division of British Railways, which is now known as National Carriers Limited, acquired obligations not only to the work force that was transferred to it but towards those who had already retired on pension from British Railways. In other words, the Corporation inherited not only pension obligations towards future retired members of the work force but towards members of the work force that had already retired from British Railways.
That represents a substantial burden. It means that before trading starts in any given year the Corporation has to find £2½ million. The Railways Act 1974 relieved British Rail of its pension burden. Surely it is only right that the Corporation should have its case answered when it asks why it cannot be afforded similar treatment.
I have heard previous Ministers, both Labour and Conservative, say that it was always the intention to refinance the business of National Carriers Limited from sales of valuable land that is held throughout the country. However, when the Community Land Act was mooted £50 million was removed from the company's capital value.

Mr. Ridley: Hear, hear.

Mr. Bradley: I fully expected a response from the Opposition Benches. I mention that matter not in a party political context but as a matter of fact. However, as is known on the Government Benches, the Community Land Act has wider benefits. In considering this specific financial problem we should not underestimate the effect that it has had on the

capitalisation value of the Corporation and its subsidiaries.
All these matters add up to the need for financial reconstruction. We must be put into the picture about the Government's intentions at the earliest possible moment. I firmly believe in public transport and the vital rôle it can play on behalf of the economy and the community. I strongly reject the inference of the hon. Member for Sutton Coldfield that we can leave transport to the free interplay of market forces. In my judgment that would produce so much waste and duplication as to put an intolerable burden on our national finances.
We need a clearer definition of transport policy. I believe that that is what my right hon. Friend and his consultation document is all about. I refer to the document that the House will shortly be considering. I am pleased that my right hon. Friend is bringing a fresh mind and, if I may say so, a shining intelligence to these matters. He has applied his mind to transport problems over very many years. I entered the House in 1962, at almost the same time as my right hon. Friend, and I remember his speech on the Beeching Report in 1963. He has a record and a background of deep interest and involvement in transport affairs and we are right to place every confidence in him. We look forward to the policies that we know he will produce.

5.15 p.m.

Mr. Nicholas Ridley: The hon. Member for Leicester, East (Mr. Bradley) speaks most convincingly and attractively, but he sounds like one of his more senior colleagues, the Chancellor of the Exchequer, who blames all misfortunes upon inheritance and always predicts sunshine next year. I do not believe that the hon. Gentleman, the Minister or anyone else believes that next year the National Freight Corporation and the Railways Board will miraculously break into sunny economic climates. However, it is a sort of ritual of those who support these ossified bodies that they have always to say that that will be so, otherwise there is no way in which they can support the thesis that no change should be made.
I know that these debates are embarrassing to Labour Members. I noted


that the Minister said at the beginning of his speech that he hoped that we would move on to the policy debate as soon as possible. It is clearly embarrassing for him to have to discuss pounds, shillings and pence and the effect of Government policy. He then said that we were not to attack the management of these loss-making concerns. He seemed to be suggesting that I must be a decent, honourable sort of chap and lay off attacking management. But supposing this had been a financial company such as Slater Walker or Keyser Ullmann. Would someone from the Government Benches have told me to lay off attacking the management, explaining that it was all the fault of the shareholders?
I do not think that I can excuse management entirely, although I shall mainly direct my remarks towards the economic climate in which the Government force enterprises such as NFC to live. We have in the National Freight Corporation a sort of public sector V & G, a poor man's Keyser Ullmann. There is no way in which that can be disguised, overlooked or disregarded. Whether we care to blame management—in my case I prefer to blame the Government—we must blame someone. It cannot be that mistakes of this order go by, like the drought, as an Act of God for which no one has to make any sacrifices.
The latest report of the Corporation is a sort of apologia, but, worse than that, it seems to ask for our sympathy. It is suggested that things were very difficult and that the Corporation had a bad year. It is even suggested that we should feel sorry for it for losing £31 million, that it was really jolly hard luck that it had to do it. It is the attitude that never has anyone been wrong and that there has been no mistake that is so intolerably offensive about the tone of the NFC and the remarks of the hon. Member for Leicester, East.
My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) quoted a sentence from the Second Report from the Select Committee on Nationalised Industries. Mr. Pettit, as he then was, said:
they will be judged by the same criteria"—
that is the same criteria on which the private sector is judged. I shall make a

further quotation from page 83, where Mr. Pettit said:
We do not rule out the fact that in the private sector businesses that do not succeed go to the wall and also that where profit margins are small in relation to certain traffic it is abandoned. We have this very much in mind in our strategy.
That seems to link up with the earlier quotation from Mr. Pettit's remarks—namely, his contention that he wanted the disciplines of the private sector.
Where he went wrong was in thinking that assets should be sold or that other assets should be liquidated to pay for his capital needs. He did that with the two shipping companies. He sold those companies because he thought that others could manage them better and because he needed the capital. That is the discipline of the private sector. That is what was done by Joe Lyons, which similarly fell upon hard times but which managed to recover by selling assets.
Why have not the Government made the Corporation realise assets to cover the £31 million in losses two years ago and the £15 million or £16 million that it lost in the past year? If the Secretary of State says "We want to take risks. We want to go into enterprising ventures in France. We want to see whether the Corporation can behave like a commercial company", he must accept the disciplines of the commercial company. Failures must be met by selling assets or closing down loss-making activities. If the right hon. Gentleman is to ask for the disciplines of the private sector, as he has, and as Sir Daniel did in 1973, the House should demand that he accept the difficulties and disadvantages as well.
I should like the Corporation to be told that next year that it must make 17 per cent. on its capital, which is the going rate, and that if it does not do so, something not very favourable will happen to the management. If the management claims that, as the hon. Member for Leicester, East and others have alleged, it has unfair economic burdens, that it had to inherit pensions which were not properly its own or that it had uneconomic social obligations—and there are many reasons why that could be so—it should tell the Government "If you want us to support these pensioners, to carry this parcels traffic or keep open a depot in an area of high unemployment,


we want a certain amount of money to cover the cost." Then we should know what was social, what was unfair and what was a commercial failure. It is very difficult to know that from the accounts put before us. As long as the chairman of a nationalised industry can say "The Government asked me to do this or forced me to carry that", which is not quantified, he can always imply that the vast bulk of his loss was due not to commercial failure but to a social obligation put upon him by the Government.

Mrs. Gwyneth Dunwoody: I hope that the hon. Gentleman will forgive me if I remind him that when he applied those solely arbitrary methods to a semi-autonomous body, the National Film Finance Corporation, when he was a Minister, he insisted on conditions which made it impossible for it to work. All that he did was to neuter that unit so efficiently that it has never recovered. The hon. Gentleman's own Government had so much faith in his ability that they asked him to leave.

Mr. Ridley: It is probably out of order to say this, but I must confess that I think I made a mistake. I managed to persuade the Conservative Government to match pound for pound money raised by the National Film Finance Corporation in the City to finance commercial films. My colleagues said "Do not pour more good money after bad", but I got the scheme set up, with their grudging consent. I think that I should have been wiser not to do so and that they were right.
To return to transport, I think that the method I have described is the way in which we should deal with uneconomic activities. It is the way in which British Rail's uneconomic activities are dealt with. I have talked to Sir Richard Marsh, who is convinced that it is possible to quantify the cost of socially desirable activities which are not commercial. I believe that of all the nationalised industries, British Rail has at some stages been nearest to having a form of financing which is understandable and has a certain degree of accountability, because if the railway from X to Y is to be continued we know that it costs £Z. Therefore, we can judge the value of that branch line in terms of what it costs.
If all economic activities are rewarded, we have a measure of the varying efficiency by the profit and loss, after taking account of grants at the end of the year. I do not want to question the grants to British Rail, because I believe that there has been at least an attempt to quantify the burdens upon it.
It does not seem to me good enough in terms of public accountability that we should accept the position outlined by the Minister in regard to the National Freight Corporation. He should tell us what he will do to reduce the loss to zero and put the Corporation into profit. He should also tell us what will happen if he does not succeed. The crunch is what happens if a target is not met. If the loss goes on, who will be sacked, who will be made to sell assets, how is the taxpayer's investment to be safeguarded?
I understand that requiring the Corporation to cover its losses by selling assets would result in its ceasing to exist after a very short time, because it would sell off all its assets. That could not be a bad thing. European Ferries was pre-prepared to pay the Corporation £5 million for a wasting, loss-making shipping asset, and has made it profitable. No one has lost his job and the taxpayers are not losing money on that shipping line. The Corporation is freed of a responsibility that it did not want.
Where a public industry fails the nation, it should be part of the inbuilt discipline that it must sell its assets, close them down, or, in some cases, raise its prices to cover its losses. No amount of bland talk such as we had from the Minister and the hon. Gentleman, about how next year will inevitably be better, is acceptable. There is no other way in which they can believe in public enterprise. They have a large public sector. They have what was wanted from the early days of Socialism, when the desire was to see public ownership of the means of production, distribution and exchange. Now they must stop hiding behind bland optimism and devise disciplines which will make the wretched public sector work.
I entirely support the desire of my hon. Friend the Member for Sutton Coldfield to vote against the Bill. I do so in the purely negative sense of knocking this unsuccessful public Corporation but because it is essential to bring home to the


Labour Party and, I suspect, to civil servants that they must now make the thing work.
The hon. Member for Bolsover (Mr. Skinner), who is not present, has often said that we Conservatives will be stuck with the public sector if we come to office again and that there is nothing we can do to dismantle it. He mocks us. I accept that what he says is partially true, but the two sides of the House have a combined responsibility to stop the sort of thing that is happening now.
Because of the utter complacency of the Corporation's report and the Minister's speech I shall vote against the Bill with glee and with high hopes that it may be the last measure of this sort to be put before the House.

5.28 p.m.

Mr. John Prescott: The debate has shown the difficulty of differentiating between the Bill, as it directly relates to providing subsidies to maintain the present position, and the policies involved in the nature of the subsidies. I support the subsidies.
We are being asked to support them as a stop-gap, but at the same time to question whether the policies that they are intended to help are correct, and whether my right hon. Friend the Minister should perhaps give a little direction to the bodies for which the £95 million is intended. My right hon. Friend made clear that if we had criticisms in that respect we should perhaps direct them to him instead of those bodies. I am not sure that that is correct since the Minister has been quick to point out that this should involve the entrepreneurship of the Chairman of the Corporations and that we should leave them to pursue their commercial judgments. The Minister cannot have it both ways. There is a certain amount of contradiction in that view.
Another important point with regard to subsidies in the nationalised industries—in this case British Rail and the Freight Corporation—lies in the present public expenditure policy started by the Opposition. As a result of the public expenditure cuts, directions have gone out to those companies telling them that they now have ceilings to which they must operate.
I am concerned about uneconomic railway lines which for social reasons should be retained. It seems that there is a political decision that determines the way in which such a line stays in being and whether the Government will subsidise it.
There is an example of this in my own constituency with regard to the Eastern Region of British Rail. We are told that it will receive only "X" amount of subsidy and that it can decide where to put the money. In so doing, it will effectively be taking social and political decisions normally made by Government. It will now be determining a commercial criterion, but the management will have to decide whether to put the money into the improvement of track or to use it to subsidise some particular line.
In my own constituency the Hull-Bridlington-Scarborough line is important. But it cannot make a profit because it has no commercial freight that it can carry. It is a classic case of a line which serves a community but which cannot necessarily meet the normal criteria used for profit.
A similar policy was pursued in the ports industry by the Opposition. It was a disastrous policy and led to the previous Tory Government reversing some of the ports policy. I am seriously in doubt about some of the policies being pursued at present in support of these subsidies.
It is right for us to question the track record of companies, but anyone trying to work through a Select Committee report knows that there is a mass of detail and that it is not possible to cover every part of that report. Those of us who are members of the Select Committee have the advantage of remembering more about the report. I can assure hon. Members that the point about pensions was brought to the attention of the Select Committee. I would recommend the hon. Member for Sutton Coldfield (Mr. Fowler) to read the report more closely.

Mr. Norman Fowler: Where?

Mr. Prescott: I do not have the report with me but I shall look at it and let the hon. Gentleman know. I am sure that I was involved in questioning particularly in regard to pensions. It was


a problem that faced the National Freight Corporation at that time.
I want to make a number of remarks about the considerable amount of attention that has been given to the National Freight Corporation. I do not make these remarks in any kind of ideological sense. I have a committed political position with regard to transport.
However, it is clear that there are differences in philosophy between the two main political parties about transport. I am not so sure that I even completely support the policies that my own Government tend to pursue. Whereas the Conservative Party believes in the marketing system, we believe that the kind of money involved in an integrated system should be developed, and we await the Government's plans.
Some of the remarks made by the Opposition have been somewhat biased. I would remind them that the National Freight Corporation was given the responsibility of changing to integrated road and rail while at the same time the private sector was left to take the most profitable sectors. This led to an uneven situation between the two sides.
The National Freight Corporation inherited a £20 million deficit and was given four years to clear it. The organisation made an impressive start. That was the opinion of the Select Committee at the time. But one can also say that there was a serious deterioration after that. The Corporation became involved with the European operation. I questioned that in the Committee and said that I was seriously in doubt about it. I seriously criticised the Freight Corporation for selling off its shipping interests, which were not loss-making. The Atlantic Steam Navigation Company, which was a State organisation, made its 17 per cent. profit.
That was a very short-sighted view and I assume the Corporation took the decision to accumulate capital because of its debt problem. The National Freight Corporation inherited a considerable problem and faced recession problems that all transport companies have to face.
I would point out to the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) that two-thirds of the Freight Corporation's operations—in companies such as BRC and Pickfords—are equally

competitive with any private company. Their returns compare in a positive way with the private sector.
But National Carriers causes considerable concern. It was a debt that the Corporation inherited. I do not think any organisation could deal effectively with it. I hope that the transport integration policy will look at this. As a result the Freight Corporation was left with a loss and could do very little to improve it.
I would point to some of the other things that the Freight Corporation does. It is one of the major trainers of licensed lorry drivers of heavy goods vehicles. But the private sector pinches them and is not prepared to pay the heavy costs of training.
The Freight Corporation is one of our main contributors to training skills. It has always been. There is also no doubt that with regard to environmental matters, and industrial democracy the Corporation has made considerable advances that are much better than anything in the private sector. It is concerned to modernise and it should have the capital to carry it through its problems. The Select Committee discussed that also.
I was extremely critical of the European operation, which at the moment is involved in a legal case in France. Before making a judgment one should perhaps wait to see whether that legal case proves that direct misrepresentation was involved.
The Freight Corporation forecasts a loss of about £50 million. But a political decision was taken which made it more difficult for the Corporation. That is something to be considered when we are passing judgment on the Corporation and its activities.
Freightliner has now had a remarkable turnround. The question was asked whether it would see a turnround or whether it would break even. The figures show that it made a profit last year. There has been a considerable turnround in Freightliner, and I praise it for not closing down Hull Freightliners. With my colleagues who represent Hull constituencies, I have been pressing about this matter, and my attitude to this Bill might have been flavoured differently if precipitate decisions had been taken in that area. We fought a constant battle,


and I want to put it on record that, when we talk about the type and quality of management in this industry, we have there in Mr. Bleasdale a manager who is as good as anyone to be found in the private sector. Whether an industry is State-owned or private, the quality of management is important.

Mr. James Johnson: As the constituency Member for the Dairycoates depot, I am glad to say that there is now a better spirit among the staff and that my hon. Friend and I can feel a great deal happier about it. They have had a stay of execution and are now doing much better. They feel now that, as a result of their efforts, they will escape what my hon. Friend and I feared some weeks ago, and Hull Members will be going to see Sir Dan Pettit about it any time during the coming week to suit his convenience.

Mr. Prescott: I agree with my hon. Friend. We work together closely on these matters. But the Freightliner difficulties are not restricted to Hull. My remarks are directed to the finance in this Bill which is going directly to the National Freight Corporation, on which Freightliner may have some claim. It is profitable at the moment—it is not a drain—but its capital programme may require some of these assets.
To my mind, the accounts of these organisations leave a great deal to be desired. The hon. Member for Sutton Coldfield said that we should look more closely at how the accounts are prepared and that more details should be put into them so that this House might make a better judgment of applications for additional subsidies. My right hon. Friend knows that in the case of Freightliner there have been seriously contested views about how accounts, if produced in one way, can be made to show a loss and, if produced in another way, can be made to show a profit. That causes considerable concern. Frequently, part of an organisation is threatened with closure as a result when, very often, accountants disagree about the true way of dealing with the accounts. These matters are being discussed with Sir Daniel Pettit and others to see whether we cannot thrash out some understanding. It is a very important point, and I

hope the Government will consider whether we cannot get a better way of dealing with accounts when they are reviewing our transport policy.
I leave the House with one example of that which arose during a meeting of the Select Committee. We asked Sir Richard Marsh how he arrived at the figures for charging Freightliner for an engine to take haulage from one point to another. This is a very important part in financing Freightliner operations and in deciding whether a line is making a profit or a loss. He said that he did not really know and that it was very difficult. In our report, we asked the Government to look carefully at this and to try to arrive at a formula which was acceptable to all. Unfortunately, the Government replied that this was difficult to do. I found that extremely unsatisfactory.
But what happened was even worse, because Sir Richard Marsh saw this as an excuse to increase charges for haulage on British Rail, thereby making the link on the Hull line much more precarious. His arbitrary decision to increase the charges threatened the prospect of Freightliner development in the area. I hope that the Minister will bear in mind these matters when he is studying these problems.
We have heard many comments from Opposition Members about the shipping industry. As the House knows, it is the industry with which I am most conversant. It is the financing of the industry—the amount of money available from the State or from the parent company, British Rail—which determines the quality of service. Anyone looking at the history of British Rail shipping will discover that it was the first to develop hovercraft, container ships and roll-on/roll-off ships. It has a history of innovation which is not matched by the private sector.
The great problem was that it did not have the money. It was denied capital by the major corporation, British Rail, which was losing money and not prepared to put it into shipping. The denial of capital to certain of its parts puts the State sector at a serious disadvantage compared with the private sector, and the result is that its capital structure in terms of ships is twice as old as that of its private competitors. The Fishguard lines—the Irish routes—are all showing signs


of dilapidation because of the denial of capital, about which we are making representations to the Minister.
In my contribution, I have tried to suggest that we should not give the impression that this House will provide money and leave judgments to managements outside. The judgments should be ours as well. They are not solely commercial ones. They are also political, social and economic ones. We have a responsibility and we are answerable to our constituents. I hope that perhaps we shall be able to combine the financial obligations with the political decisions which are needed in transport.

5.45 p.m.

Mr. John Cockcroft: One of our difficulties today is the successive writing-off of losses by State industries in general and by the transport industries in particular over many years. This applies especially to the railways. We have now reached the situation where it is almost impossible to say in real terms what is a profit and what is a loss.
We see what might be described as the endless search for the Holy Grail of an integrated transport policy. Everyone knows about it because it is the fashionable "in" phrase. But no one is clear what is meant by it. It is a vague idea. Mainly, it seems to involve integrating the timetables of the railways and the buses. People have latched on to the idea that no one should waste more than a quarter of an hour at Cambridge Station before being able to catch a bus to Grantchester, for example. Beyond that, it is a rather elusive concept. What I hope that it does not mean, although I fear that in many minds it does, is that eventually we shall see the deliberate elimination of competition between the different forms of transport.
In the case of the railways, there is the perennial question of track costs vis-à-vis road transport. Large lorries—the so-called juggernauts—pay very heavy annual taxes at fixed rates. Otherwise their marginal costs—the cost of moving a vehicle from A to B—are relatively minimal. That immediately raises the question whether, if we are to have more roads, we should not have more tolls to pay for them. The system of tolls which is very general in America seems to work perfectly well on

American highways. I do not see why it should not work here.
The railways in this country have inherited most of their track from the more distant past which, with the excessive writing-down of capital, costs them very little in terms of amortisation. On the other hand, they have very heavy running, signalling and general costs in maintaining the track which exists already, unlike road hauliers who use our roads largely free of charge, having paid very heavy taxes. This is one reason why the railways lose money—a great deal of money on many lines. It is a great problem to know how to distribute overheads on the railways between the regions and from the centre to individual lines. This is a problem which has dogged the railways for many years.
During the debate, there have been references to the hearings of the Select Committee in past years. I am fortunate enough to be a member of that Committee. We have taken a great deal of evidence at many hearings and we have made fact-finding visits both here and abroad to try to discover the position of the railways and other forms of transport in different parts of the country, as well as the London region, and in other countries.
It is well known, and has been borne out by our inquiries, that railways in most parts of the world lose a great deal of money. Therefore the question arises what can be done about this. Many of our investigations have been devoted to the sort of measures which should be used to bridge the gaps between costs and revenue. There is a fundamental problem here and we shall never solve it completely.
There have been so many formulae over the past two decades—the successive writing down of capital on the railways; the so-called social grants for railway lines which were regarded as socially necessary—not that I am against that in principle; periods of telling the railways that they must break even, taking one year with another; financial targets set by the Treasury which were hardly ever met but which were in principle desirable; periods of restraining prices under almost every Government; and grants-in-aid made—the measures which have been adopted


have been legion. This has been not only because of the changes of Government but because the problem is basically insoluble.
British Rail is a paradox. It is among the most technically advanced railway systems in the world. The high-speed trains which run on western routes—and they will shortly go up to Crewe and beyond—are an example of this. We are abreast of all the latest technical developments on the railways. But at the same time there is overmanning. This problem has been exaggerated by some people, but nevertheless there is a degree of overmanning despite a run-down in staff in recent years. There is also generally low morale, and I sincerely hope that Mr. Peter Parker will put right the serious failure in communications between management and unions. Also it would be a help if there were only one union on the railways instead of three eventually.
There has been a general lack of understanding of the investment problems of the railways. We were told in the Green Paper that the investment levels would be held or even reduced in real terms for at least the next few years. We read about existing lines having new electrification schemes, such as the Bedford and Cambridge lines, while it is manifest that a lot of the existing stock is being run down. Here again there is a failure of communication on the part of British Rail to explain what it is trying to do. I do not disagree that previous electrication schemes were largely a great success. There is no doubt that traffic on the London to Manchester and London to Liverpool lines, which has been in direct competition with the shorter airline hauls, has increased—at least until recently when the fares went up so much. Many people feel that British Rail should not go into these prestige schemes when it cannot run trains from Chessington, Surrey, to Waterloo, for example, on a regular basis.
The main difficulty in the many debates we have in this House on transport is in assessing the real costs of running a railway engine. In some ways the cost of moving a heavy lorry is more easily quantifiable, and a more exact price can be put on it. However, there is the general problem of road jams and the loss of resources caused by traffic conges-

tion in major cities such as Birmingham, Manchester and Coventry during rush-hours. No one can really say how much it costs if tens of thousands of people are stuck in their cars. Some of them are highly paid executives who are wasting time in a traffic jam when they could be travelling by rail.
Nor can anyone put a price on the cost of pollution which comes from enormous lorries going through small villages and virtually running them to pieces. I am fortunate enough to have an Adjournment debate on Thursday next week about the need for a bypass of the villages of Holt in Denbighshire and Farndon in Cheshire. In that part of the world there is a 14th century bridge and some ancient houses which are actually crumbling into the ground because the weight of heavy traffic on the roads is too great for them to bear. These are things on which one cannot put a price.
Finally, I make a plea to the Minister that nothing drastic or irrevocable should be done about transport in the next few years. Nothing should be done which would be comparable to the situation in America where the New York State Railway network was run down, and this decision could not be reversed. If we do irreversible things we may rue the day we did them.

5.56 p.m.

Mr. Michael McNair-Wilson: This has been a most interesting debate. All the comments that have been made about rail freight and the National Freight Corporation have added considerably to the knowledge of many of us. I listened to the Secretary of State with great interest, and I hope that he will forgive me if I say that at the end of his speech I was not very clear how this total sum of money was to be spent. I believe that £45 million is to go to British Rail and £50 million to the National Freight Corporation, but I feel that the Minister himself was not absolutely sure how it was to be spent. I think that he was faced with a couple of bills and he knew that he had to pay them. However, he did give us plenty of warning that this was to be, because he made a statement to this effect in February last year.
My hon. Friend the Member for Sutton Coldfield (Mr. Fowler), in an outstanding speech placed great emphasis on one


point which I wish to follow up—that is, how we can find out where the money is going and how we can have a more accurate form of accounting from State corporations. Obviously this applies to any State industry, but because we are talking about transport today I shall restrict my remarks to British Rail and the NFC.
I declare an interest. Like my hon. Friend the Member for Nantwich (Mr. Cockcroft), I am a member of Sub-Committee A of the Select Committee on the Nationalised Industries, and at the moment we are inquiring into British Rail. I endorse much of what my hon. Friend said. We on the Committee have had an opportunity to see a great number of Western European railway networks and we came back from Europe much prouder of British Rail than we were before we went there. Until then we did not realise how much more European countries spend in subsidising their rail services than we do. We have learnt a lot from these visits, including the fact that most Western European railways carry much more freight than British Rail. This is a point worth considering when we talk about money for British Rail services.
I thought that my hon. Friend the Member for Sutton Coldfield's criticism and indictment of the way in which the National Freight Corporation is run was perfectly fair. I was a member of the Select Committee that investigated the Corporation. I do not want to make a blanket criticism of those who are running it, but at the end of our inquiry I do not think that any of us were satisfied that the NFC was on the way to a great success. Therefore, when we hear of the recurring losses and see the 1975 annual report—which I received this morning—and when we read of the progress or otherwise of the various parts of the Corporation, we feel deeply concerned that it is not going the way that those who panned it hoped it would. It is right, therefore, that we should all consider how every penny of public money is being spent, and whether the Corporation is meeting its criteria. If it is not we must consider what we can do about it.
If the criticisms sound harsh and the indictment severe I hope that those who run the Corporation will consider the

criticisms carefully, and I hope that the Secretary of State will do the same. We are impressed by the freshness of his approach to the transport business.

Mr. Gwynfor Evans: Does the hon. Member agree that it is not altogether a good thing that British Rail is so secretive about its income from the carriage of freight?

Mr. McNair-Wilson: I entirely agree with that point, and I hope to enlarge upon it.
We are holding our debate against the background of the recession of 1974–75, which lapped into 1976, and we recognise that all freight services have had a cut-back in the goods they were hoping to carry—a cut-back which has affected them financially. I fear that the dream that I shared with others, of switching much of the freight that goes by heavy lorry on to the railways, will not be realised to the extent that once seemed possible. But I still believe that there is room for moving more of that freight by rail. The massive switch will not occur, and the consultative document says more or less just that, but there is room for initiative by the State carriers to expand their activities.
I should like to know how much of the £45 millions going to British Rail will be used to finance or subsidise private sidings for factories. Perhaps the Secretary of State will say that this item is not covered by the £45 million. Nevertheless, I should like to know whether the programme will go ahead. One fact which came out of our Western European tour was that in France in particular there is a very large number of private sidings. One French railway official told me that because the sidings were there the freight continued to be run into them. He said that because of our Beeching cuts, far too many of our sidings had been closed down and British Rail had therefore lost the opportunity to move freight from siding to siding. Quite a lot of investment has gone in this direction and I hope the Minister will explain whether the money set out in the Bill covers that point.
The hon. Member for Carmarthen (Mr. Evans) is right to talk about the vagueness of British Rail's accounting. In the evidence given to the Select Committee


by the Department it was made clear that
for freight-only lines, the freight business is charged the total infrastructure costs; for lines shared with passenger services, however, the bulk of the expenditure on track and signalling is charged to the passenger business, the safety and comfort requirements of which dictate the standards of provision and maintenance.
In other words, what cost is the freight business really carrying? How many of these freight-only lines are there and, therefore, what is the total cost of running the freight business, leaving aside manpower, sidings, handling equipment and so on? If there is a loss, to what is that loss attributable, and how will the £45 million meet it?
That takes me on to the question of which lines are making losses and of precisely how an answer can be discovered. In Sweden we met the railway authorities and we found them a most impressive group of people. They said that they could tell us almost with certainty which of their lines were profitable and which were not. They said that if their Government were to say that they wanted a commercially viable network the authorities could tell them what that network would be. However, it was recognised that running the railways provided certain social advantages even though some of the lines might lose money. The organisation operated essentially in a commercial way. It estimated the social subsidy, which it described as the collective ticket, and that was the ticket that it presented to the Government for running the loss-making lines.
That must be the right approach. I hope that in the review the Department will give the greatest emphasis to discovering which lines are commercially viable and which are not, which are socially necessary and which are not, and how much of the existing network we should retain. I therefore say to the Minister that while we pursue a policy of public service obligations with a blanket subsidy to British Rail we shall not get that information, as was made clear by the Minister's officials who were asked about the point at the Select Committee. They said that as matters stood it would not be possible for the Department to produce a calculation for Southern Region. The Committee was told by an official

It is not a part of the grant calculation to determine what is the full loss, if I can put it like that, on the Southern Region or the Western Region or any other region of British Railways, and there is a route problem about allocating the costs which are joint or common, such as particularly the track and infrastructure.
In other words, we do not know which losses the blanket subsidies cover. I suggest therefore that we take a leaf out of the book of the Swedes and find out. Once we do that we shall start spending the money in the best way possible for the taxpayer, thus getting a true social return.
The French railway official told me that in Britain all freight was handled at goods depots by railwaymen. In France, he said, it was handled by those who were moving the goods. That was a very different approach. If a man knows that his goods are in the goods yard he will go and get them. If he waits for British Rail to bring them, British Rail will not know the priority and there may be muddle and confusion, so that the next time the man will send his goods by road. The French approach to freight seemed to provide the sort of enthusiastic approach that we need if we are to get rid of the rail deficit and make British Rail freight services as good as they could be.
I turn now to the National Freight Corporation strictly and solely within the terms of Freightliners Ltd. I was delighted to hear from the Secretary of State that this year's results are so much better than those of 1975. He was not quite so sure as some of his hon. Friends that Freightliners was actually making a profit. I wonder whether we can have the right figure on that point.
In the 1975 report, which I received this morning, I was struck by this sentence on page 14:
At the end of the year, rail services from Sheffield were discontinued and South Yorkshire is now served by road, principally from the Leeds terminal.
I do not know about other hon. Members, but it caused me to have severe doubt about Freightliners Limited, as run by the National Freight Corporation. I should like that service to be expanded. When I am told that South Yorkshire is no longer to have Freightliners, I ask "What is the future of that service?" As has


been said, it is nice to know that Freightliner Limited is still running, but what kind of network is it running on?
When I received further evidence from the National Freight Corporation to the effect that the air-braked Supervans, by which British Railways are placing so much store in terms of regaining freight traffic, may act as a serious and damaging competitor to Freightliners, I ask "what kind of world does the NFC think we are all living in?"
For my part—the Minister will find that I made this point in a minority report, if that is the right word, to the Select Committee Report of 1973—I should like to see Freightliners returned to British Railways. I am reminded of a remark by Sir Richard Marsh when he gave evidence—that the people who most care about selling rail freight are railwaymen. With Mr. Peter Parker and the new enthusiasm which he has brought to British Railways now in charge of that Corporation, I should like the railways to take on Freightliners, to increase their freight sidings, to buy new wagons and expand the computerised TOPs system rather than to adopt the defeatist, pessimistic view which the NFC gives in its report—that South Yorkshire is no longer on the container line and that the Supervan looks as if it will damage Freightliners still further. That means that Freightliners will soon not exist, and the loss will be great to the country, to British Railways and to all who work for them.
If Western Europe can make a success of railway freight, so can we. I admit that the distances in this country are much shorter than in Western Europe overall. For that reason, I regret that the Channel Tunnel project did not go ahead. Had it done so, what Sir Richard Marsh described as Eurorail would have come into existence. if so, our railway freight system would have had the advantage of long haul into Western Europe, which would surely have been profitable.

Mr. Ronald Atkins: I agree with the hon. Gentleman about the Channel Tunnel. However, he may not be aware of another reason why freight transport by rail is stronger in Western European countries than in this country. One reason is undoubtedly the large amount of subsidy which freight

receives from Governments on the Continent. The figures appeared in the Financial Times two or three days ago. The German railways, which are roughly comparable to ours in size and are subsidised by £2,500 million a year, had a deficit of £1,250 million largely due to losses on freight.

Mr. McNair-Wilson: That is an extremely interesting intervention. I did not refer to West Germany when naming certain Western European services, because the West German Government are now looking at their railway network more acutely than we are looking at ours. They are determined to reduce that vast loss to the greatest extent possible. But German trade unionists, whom we met, were extremely interesting about the type of freight now being carried. They said that too many railway systems had a traditional approach to the type of freight to be carried and had not adapted to the fact that whole trainloads of goods might not necessarily be the best mode of transport at which we should be looking in future. The ability to break up the train, which we may be able to do with the air-braked wagon, could be the way forward.
The German Minister whom we met—an SDP member—forcefully made the point that, in his view, vast subsidies to an unprofitable State organisation was the worst waste of socially available funds that he could think of. Looked at in that way, the idea of giving subsidies to organisations which are inefficient, uncompetitive and unprofitable takes on a completely different complexion and should make us all realise that it is not the way to get the best out of the contribution being made by ordinary people by way of taxation.
We must know more about how these sums in the Bill are to be spent. If we are to expand rail freight—I believe that is possible—we must in turn give British Railways a measure of security regarding the network that they will be operating. Unless British Railways can say to those whose goods they wish to move that they will have the network to move those goods, then those goods will be lost to the railways.
I refer now to the competitiveness of freight rates. Railwaymen in Wales whom we in the Select Committee met


told us they were demoralised because they felt that British Railways had not got their freight rates policy right and that they were being asked to approach people with freight rates which they knew would lose them business before they started. British Railways must break even. It is not for me to say that their marketing men do not know their jobs. Railwaymen are keen to make their freight services a success, but they feel that they are not living in a truly competitive world. Therefore, freight rates are of crucial importance.
The reliability of services cannot be overstressed. If one asks any industrialist why he has gone to road haulage, he will give one of three reasons: first, that British Railways are uncompetitive and he is living in a competitive world where every penny counts; secondly, that the distance is too short; or, thirdly, that he cannot rely on the railways to get his goods where he wants them to go. British Railways are aware of this problem.
Lastly, I turn to the problem of fiscal measures to create a more competitive environment. We must be very careful about this matter. Railways people always say that road has an advantage and road people say that road has no advantage of which they are aware. What matters is that British goods should go where they are wanted at the right price so that we may remain competitive and get the markets which we sorely need. I am not saying that there is not an argument for looking at comparative costs, but we would be unwise to pin our hopes to so altering the tax borne by road haulage as to give a theoretical fairness to British Railways. I we thought that was the way out, we might end up with higher freight rates all round and British goods less competitive.

6.18 p.m.

Mr. Ian Gow: The House has become so used to Ministers coming to the Government Dispatch Box and asking for further sums to subsidise the public sector that I suppose we should at least be thankful today that the sum asked for is the relatively small amount of £103 million. Nevertheless, I do not think that we had a sufficiently contrite attitude by the Secretary of State when he introduced the Bill. One thought, listen-

ing to the right hon. Gentleman, that this further borrowing power of £8 million for the British Waterways Board and this £95 million, which is not a loan but a grant, were almost part of the grand design, and that we were on course. There was no confession of sin, no contrition and no acknowledgement that the public sector had gone catastrophically wrong.
I congratulate the Minister on having said that the main responsibility for the three public entities that we are debating this afternoon rests firmly with him as Secretary of State. Any criticisms I may make in the course of my remarks about the National Freight Corporation will be directed not at the management or employees of the Corporation but at the system over which the Secretary of State presides. Sir Dan Pettit, his colleagues on the Board of the NFC, and the Corporation's employees are, in a sense, helpless victims of a system over which they have no control.
I want to emphasise to the House the extent of the Secretary of State's responsibilities for the administration of British Rail. Clause 1(2) of the Bill refers to the Railways Act 1974. Section 3(1) of that Act says that the Secretary of State:
may give directions to the Board imposing on them obligations of a general nature with respect to the oeration of the whole or any part of their railway passenger system.
Subsection (4) says:
The Railways Board shall, in formulating policies and plans for the general conduct of their undertaking and the business of their subsidiaries, act on lines settled from time to time with the approval of the Secretary of State.
This underlines the principle of the proposition that it is upon Ministers and the Government that the responsibility for the Bill and this request to the taxpayer for another £105 million rests.
I have only one observation to make about Clause 1. The Secretary of State says that the additional £45 million referred to there would be used for only the freight sector of British Rail. There is certainly no reference to such an undertaking in the Bill. If I understand the wording correctly, the British Railways Board could, with the consent of the Secretary of State, use the £45 million for any purpose quite unrelated to freight. Will the Minister address himself to that point?
I now turn to Clause 2. The Minister spoke at length about the improved performance of the NFC and told us that the loss in the year ended 31st December 1976—we have not yet received the final accounts—would be in the region of £16 million, compared with £31 million for the year ended 31st December 1975. I noted that he gave no apology. Indeed, it was held to be a triumph that the NFC was operating at a loss of only £16 million.
While listening to the Minister, I thought, as perhaps even he did, of what is said in Section 41 of the Transport Act 1968. Whatever failings I and my hon. and right hon. Friends may have had in the past, the charge cannot be levelled at us that we were responsible for that Act. The Labour Party was responsible. Section 41(2) says:
It shall be the duty of each of the authorities to whom this section applies so to perform their functions under the Act of 1962 or this Act as to secure that the combined revenues of the authority and of their subsidiaries taken together are not less than sufficient to meet their combined charges properly chargeable to revenue account, taking one year with another".
In other words, stripped of the verbosity of the parliamentary draftsmen, there is a statutory duty upon the NFC to break even. That is what is meant. Yet the Minister came to the House today and told us that in the last year the NFC lost £16 million.

Mr. Ridley: The Minister said that the NFC had an operating profit of £4 million but said in parenthesis that there were additional costs of £20 million as though that did not really matter. It is important that we do not talk about operating profits when we mean blooming great losses.

Mr. Gow: My hon. Friend will note that I have rightly referred, in accordance with proper accountancy principles, to the loss as defined by Section 41(2) of the 1968 Transport Act. When one looks at the record of the National Freight Corporation one finds that in six out of the eight years of its existence it has made a loss and the statutory obligation laid upon the Corporation has been breached. Has the Minister responsible for this come to the House to say "I apologise. I have sinned and I must do better in future."? Has the Secretary of State apologised to the British people

who will be asked to finance the further £16 million loss of the NFC? Such words did not cross the Minister's lips. He should have appeared at the Dispatch Box upon his knees asking for forgiveness.
I have one other observation to make. The National Freight Corporation is responsible for 15 per cent. of all freight movement in this country. It is not in the classical, monopolistic position of having virtually all the market. There is no reason why a subsidy should be given to 15 per cent. of the market while no subsidy is given to the other 85 per cent. of freight operations that are carried out by the private sector.
There was another matter to which the Secretary of State did not refer. He overlooked the classic words of Sir Dan Pettit in the 1975 annual report of the National Freight Corporation. The ministerially-appointed Chairman said of the system of public ownership that the Minister claims is serving the nation so well:
The financial structure of the Corporation is bad practice reminiscent of mediaeval usury.
That comes as no surprise to me, but what proposals are there for putting an end to this bad practice? Sadly, the Government have no proposals.
My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) made—as we expected—an unanswerable case for opposing the Bill. We oppose it in the interests of financial discipline and rectitude; we oppose it because it is time that we stopped handing out loans, grants and subsidies to a public sector which will serve the nation's needs only if it is subjected to the disciplines to which the private sector is inevitably subjected.

6.30 p.m.

Mr. Roger Moate: One point of immense significance has commanded almost unanimous support from both sides of the House. Several hon. Members have emphasised the need for greater clarification of British Rail's accounts and a breakdown of costs between services. I was struck by the 100 per cent. support given by the hon. Member for Leicester, East (Mr. Bradley) to the demand of my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) who demanded a proper breakdown of costs. My hon. Friend the Member for Newbury (Mr. McNair-Wilson)


also emphasised this point in his helpful and constructive speech.
We shall not get proper accountability and efficiency unless we have publication of the full facts. The absence of proper information in British Rail's accounts has been a source of frustration to everyone who has tried to discover the facts in the last year or two. I hope that the Secretary of State has taken on board the fact that there is widespread support for a change and that if he persuades British Rail to open its books we shall have not just a change in presentation or a cosmetic change.
There must be a fundamental change in philosophy. It cannot be right that we cannot tell from the accounts how track and signalling costs are allocated between freight and passenger transport or the true cost of commuter services. We also need to know the losses sustained by the various regions.
If the accounting formula devised by the 1974 Act prevents us being given the full facts, we should look at the Act again. We shall not get efficiency unless there is full accountability and we shall not get accountability unless there is full publication of all the facts. If only that point emerges from the debate, it will have served a constructive purpose.
The Secretary of State said that it was wrong to blame the management of British Rail, because any blame should be laid at the door of politicians. However, if the management seeks public acclaim for financial success, it must be ready—and probably is ready—to take the blame for commercial failure.
Tributes have been paid to Mr. Peter Parker, and he knows that he starts his reign at British Rail with considerable good will from all sides. I hope that we shall be able to lavish praise upon him in future, but if there are failures, the management must be ready to carry the can. Of course, managements are only likely to be as good as the economic and financial disciplines imposed upon them by the Government. The Government lay down the disciplines—or fail to lay them down—and create the economic environment in which nationalised industries have to operate.
The Government came into power three years ago, claiming that they be-

lieved in an integrated and co-ordinated transport policy but did not believe in freight subsidy. They must take a full share of the blame for having to ask for yet another major subsidy for freight. This is a condemnation of their management of our transport services.
The Secretary of State said that the Bill was a modest and not very welcome-measure. We agreee that it is unwelcome, but not that it is modest. It involves £95 million of subsidies for freight. However, that is only part of the story; the Secretary of State told us that the figures are very much greater. He said that there was nothing new in this, but it is the first time that we have had the figures presented to us and had the scale of Government support for freight revealed.
Total Government support between 1975 and 1977 inclusive is likely to be not the £95 million mentioned in the Bill but between £200 million and £250 million. It would be helpful if the Minister who is to reply to the debate could give us the precise figure, because, as my hon. Friend the Member for Newbury said, we were not much clearer about the figures involved even after the Secretary of State had finished his speech.
I arrive at the figure of between £200 million and £250 million by putting together the figures that I have managed to glean from newspaper reports and other sources in recent weeks. It seems clear that Government support has already been extended to make good British Rail's freight losses of £66 million in 1975 and £40 million in 1976. There is also the support given to the NFC, which made a loss of £31 million in 1975 and £15 million last year, though it seems that the grant payment will probably be about £22 million. These payments, already made on the taxpayer's behalf, total, perhaps, £130 million—if I am wrong I shall be glad to have the correct figures—and we must add the £95 million provided for in the Bill.
A considerable sum of taxpayers' money is being spent on the subsidy of freight—a purpose which the Government disclaim as their objective. We are entitled to demand a much clearer explanation from the Government of how the losses have arisen and whether they are satisfied with the steps taken to ensure that we shall not face a continuing


drain on taxpayers' resources for the subsidy of freight.
Information in the Bill is sparse in the extreme and the House would be right to reject the measure for that reason alone. We cannot exercise proper scrutiny of Government expenditure when legislation is put forward in this way.
I said earlier that subsidising freight was contrary to Government philosophy. The consultation document stated with admirable clarity that there was no case for a general subsidy for freight. It went even further when it said that investments in freight should offer rates of return as good as those in the private sector. We can all commend those worthy intentions, but the Government then spoil it by saying that interim arrangements would be necessary so that these sectors could return to profitability.
How often have we heard those words before? The 1968 and 1974 Acts said that there should be no freight subsidy, yet in the first full year after the 1974 Act—in which British Rail presumably accepted the philosophy of breaking even on freight—a loss of £66 million was made on freight and parcels on a turn-over of £330 million. It is argued that this was due to the recession, but it is significant that the tonnage carried in 1975 was almost the same as in the previous year. If the recession were to blame, one would have expected a drop in the volume of goods carried.
It is a matter of concern when a philosophy is accepted that there should be no losses but that when a substantial loss is produced the Government agree to bail out that operation not just for one year but for subsequent years. Far from it being a break-even situation, The Sunday Times, no doubt using official information, says:
The British Rail Board was told last Thursday that the 1976 loss target of £60 million set for freight had been significantly beaten".
I find that loss target an interesting concept. By statute, British Rail is not permitted to make a loss on freight. It has no legal basis for this loss, and yet it has become part of Government philosopy to accept it. British Rail knew that it could turn for further subsidies to the Government if it needed to. That undermines management and causes economic disciplines to break down. Had

the Government said that such a loss was unacceptable, British Rail would have been forced to introduce more realistic pricing policies and would not have been in the position that it is at present.
I now turn to the hidden subsidy to freight which was discussed by my hon. Friend the Member for Sutton Coldfield. We are entitled to some figures from the Government about the amount of track and signalling costs that have been allocated to freight. In British Rail's 1975 accounts track and signalling costs and relevant general expenditure totaled £308 million. The probability is that nearly all of that was allocated to passengers. We do not know the breakdown but it is likely that a fair allocation of costs to freight should be between £100 million and £120 million. That is only a guess, because we do not have the information. If the commuter is being blamed for these massive losses when part of them is caused by the freight operation we must be given the facts. In the long term it is not in the interests of British Rail, the taxpayer or an efficient economy to distort the true cost of the carriage of freight.
I now turn to the National Freight Corporation and the Bill's provision of £50 million for it, for the future. I say "for the future" because I understand that past requirements have already been funded by the Government, and therefore the £50 million must be for some future purpose. We have not been told what that purpose is. We must have a clear explanation from the Government. We are being told how desperate is the need for the money and at the same time that the National Freight Corporation has turned the corner and is moving towards an operating profit. It may require some finance to cover its current operating losses, but surely not of the magnitude of £50 million.
We are aware of the possible financial reconstruction of the Corporation, but I hope that the Minister will not say that the Bill will be used for that purpose. That would be a totally improper use of the legislation. We must know what the £50 million is for.
When dealing with the National Freight Corporation the hon. Member for Leicester, East suggested that my hon. Friend the Member for Sutton Coldfield spent too much time attacking the man-


agement of the Corporation. That was a little unfair. Even the NFC will not deny that it must accept some blame for a degree of over-optimism in 1973. I am sure that it would also agree that it must accept some blame for the massive losses incurred by the French operation.
We recognise that the road-based companies of the NFC seem to have operated commercially, competitively and profitably, and that must be a reflection of the qualities of management at NFC. But management must also take its share of the blame. We are entitled to a fuller picture of what happened over the French losses. It is difficult to glean the figures but the losses could amount to £12 million, £13 million, or £14 million. That will have to be paid by the taxpayer in some form or other. I hope that the Under-Secretary will tell us the total figures involved in that venture.

Mr. Eldon Griffiths: Has my hon. Friend ascertained whether the NFC has been able to get off its back the substantial dynamised pension charge which it inherited from previous British Rail employers who had never even worked for it.

Mr. Moate: We certainly recognise that there is a case for reconsidering those inherited liabilities. One recognises the difficulties that the NFC has had with National Carriers Limited. In the Bill we are asked to provide £50 million, and the purpose of that is not clear. We are aware of losses for which there should be a public explanation. There is a general agreement that certain inherited burdens should be reconsidered.

Mr. Leslie Spriggs: Is the hon. Gentleman aware that the responsibility for having to find all this money for current pensions is the result of an agreement between the Board and the Government for financing of the pension fund? The employers never paid a contribution. Only the employees contributed. That is why there was always a deficit.

Mr. Moate: There is a case for this to be examined.
It would be churlish to ignore the British Waterways Board, which is

covered in Clause 3 and is the particular responsibility of the Under-Secretary who is to reply. We have been told that there will be a White Paper and therefore there will be further opportunities to debate the matter fully in the House. In the meantime, it seems that an increase in borrowing powers from £12 million to £20 million is not unreasonable after nine years, but I was alarmed when the Secretary of State said that he thought that this sum would serve for the time being. I hope that he does not mean that the Board will spend £8 million before the White Paper is discussed in the House. We must consider this in detail in Committee, and have to take note that the grant in aid increased from £2½ million in 1971 to £8 million in 1975.
I return to the principal part of the Bill, which concerns the freight subsidy provision. The figures that have been revealed should cause great alarm to hon. Members. The Bill provides for major public expenditure on the flimsiest of evidence. There is no economic or social case for freight subsidy on this scale. After three years the Government should have exercised tighter financial disciplines to prevent the necessity for a Bill of this kind. I hope that the House will decide not to give it a Second Reading.

6.49 p.m.

The Under-Secretary of State for the Environment (Mr. Kenneth Marks): I shall be as brief as possible, but I hope to reply to most of the points raised by hon. Members. Some of the arguments were more appropriate for discussion in Committee and I am sure that the detailed figures will be examined at great length there.
Some of the speeches—almost in their entirety—were more appropriate to the debate on transport policy which is to follow. That debate will be much more wide-ranging, and hon. Members who have not taken part in this debate will then have an opportunity not only of discussing the future policy of British Rail, the National Freight Corporation and the British Waterways Board, but all the other ramifications of our transport system.
My right hon. Friend and the chairmen of the Corporations referred to in the Bill will have noted the many things said about past endeavours and possible past


errors. I want to deal with a number of points that have been raised.
Mention has been made of the accounting by the nationalised boards. The National Economic Development Office has now issued a report on the nationalised industries which, as well as making recommendations about board structure, relationships with Ministers, and so on, has made more detailed recommendations about financial matters. The Government are considering these and, taken together with the Sandilands recommendations on company accounts generally, it is likely that carious changes in the presentation of accounts will emerge, although it is too soon to say exactly what will emerge.
The hon. Member for Sutton Coldfield (Mr. Fowler) posed a number of questions. The first concerned offsetting savings in the grant to the NFC. In the public expenditure survey provision was made for the amounts that are shown in the Bill. The hon. Gentleman mentioned the British Railways Board sharing the costs and asked how much of the savings had gone to freight. As he knows, this is an extremely difficult matter. For instance, the wages element on the passenger side has been very considerable. In the figures for 10 years that the hon. Gentleman gave, he mentioned that there was a considerable decrease in the number of railwaymen employed but that wages nevertheless remained at between 60 per cent. and 70 per cent. of the costs throughout, and, indeed, that there was a substantial increase—I believe a much-needed increase—in railway pay, particularly towards the end of that period.
On the question of pensions and the NFC's share, it is true that British Rail was exempted from some costs and that the NFC was not. This is proving to be a considerable drag on NFC finances—as much as £4 million, I understand, and not the lower figure mentioned by my hon. Friend the Member for Leicester, East (Mr. Bradley). The whole question of the NFC and this burden is very much under consideration.

Mr. Bradley: Does my hon. Friend know that on 2nd January 1969—the day after vesting day—British Rail advised the NFC that it had got the figure wrong

and that it was double what it had originally been told?

Mr. Marks: I was not aware of that. However, that will be taken into account in the consideration of this matter.
I come to the question of the increase in the losses on the European subsidiaries of the NFC. The only figures that I have available at present are those shown in the annual report for 1975. They show a net deficiency of £6·4 million as at 30th November, plus provision for closure costs of £5 million. I gather that in practice closure costs are likely to be higher than those originally estimated, but the final outcome will depend on a number of factors, including the outcome of legal action which the Corporation is taking against the vendors of certain of the businesses that were sold to it and the proceeds of sale of assets abroad not yet realised.
The question of parcels will be taken into account in the debate to follow, with the whole of transport considerations. This question has to be raised not only in the context of the organisations that we are now discussing but in the context of the Post Office and, in some cases, of the municipal and county enterprises which are going in for this traffic. We hope to put something in the White Paper on this matter after consideration of the consultative document.
My hon. Friend the Member for Leicester, East put forward a great number of facts in response to what was said by the hon. Member for Sutton Coldfield. I welcomed my hon. Friend's assertion that the morale of British Rail workers has improved. When I went into that side of the Department in December, I could not have arrived at a time when there was a greater ebb of morale in the workers. What my hon. Friend said about that and about their increased faith in the management of British Rail is to be welcomed.
I have no doubt that the overall figures in the Bill will be discussed in Committee. It must be emphasised that the Bill gives authority for grant to be paid to the NFC up to the maximum of £50 million. The NFC may well not need all of that, but the figure is based on an assessment of its cash flow needs while measures to achieve viability are being put into effect.

Mr. Norman Fowler: Will the hon. Gentleman therefore confirm that any costs in restructuring or reorganising the NFC would be in addition to this £50 million?

Mr. Marks: Yes, we can say that at present.
I come to British Rail and the £45 million. My right hon. Friend went to some lengths to explain this matter when he talked about Clause 1. Some of the payments are overspill payments from 1975 and 1976, and there is £30 million provision in PESC for freight for the coming year.
My hon. Friend the Member for Leicester, East also mentioned development land tax, which will have an effect on the NFC. Like any other business, the NFC is now liable for development land tax when disposing of surplus land. This may mean some reduction in the proceeds that the NFC obtains from such disposals, which up to now have been mainly of land owned by National Carriers Ltd. As my right hon. Friend made clear, the objective is that the NFC should become a fully viable business. This must mean a business in which finances are not dependent on shortfall benefit from windfall land sales. The Bill is designed to cover the Corporation's cash flow deficit as the Corporation moves to viability.

Mr. Eldon Griffiths: Will the hon. Gentleman give way?

Mr. Marks: We are short of time.

Mr. Eldon Griffiths: I apologise for intervening in a debate that I have not attended throughout. However, the hon. Gentleman will know that I have a previous interest in this matter. Will he give a categorical assurance that the £50 million covered by the Bill in respect of the NFC will in no circumstances be used for the capital reconstruction that we anticipate will be needed in a relatively short time?

Mr. Marks: I think that my right hon. Friend has made clear already that that cannot be done under the Bill.
The hon. Member for Nantwich (Mr. Cockcroft) made a speech that was mainly one for the following debate. However,

he mentioned the problem of quantifying costs. This is an extremely difficult problem in railway matters. As he said, we do not really know the cost of road transport to the community. That is an important point.
The hon. Member for Newbury (Mr. McNair-Wilson) recognised that the recession was an important factor. I welcomed his knowledgeable views on various matters as a member of the Select Committee. He mentioned the sidings grants. They are not included in the Bill. Sidings grants are separate and go to firms and not to the nationalised corporations. There is a £35 million grant over the next five years. I note what the hon. Gentleman said about Sweden, in the Western European context As he pointed out, some countries have railway problems that are different from ours.
The hon. Gentleman asked about the results of Freightliners Ltd., in 1976. Only preliminary figures are available, because it is, after all, only two weeks since the end of the calendar year which Freightliners Ltd., use. It is estimated that the trading levels will show a plus of £1·5 million, but that after interest charges, headquarters charges, and so on, there will be a minus of £1·5 million. There have been big improvements, and I recollect speaking in similar debates last year when the outlook was a lot blacker than it is now.
The hon. Member for Eastbourne (Mr. Gow) says that Ministers of Transport should adopt a more contrite attitude and go down on their knees. There have been losses for six years out of the past eight, so not all the Ministers who should go down on their knees would have come from the Labour side of the House.
We take note of what has been said about accounting and the need to get as much detail as we can.
I realise that I have not answered all the points that have been raised, but further questions can be asked in Committee.
The hon. Member for Faversham (Mr. Moate) is right; total grants for the period 1975 to 1977 will amount to £200 million if the total here is included.
As my right hon. Friend said at the beginning of the debate, the Bill is intended to ensure that the three bodies


concerned are able to continue their work during a period when we shall be reaching and carrying out decisions on their future development. I urge the House to give the Bill a Second Reading.

Question put, That the Bill be now read a Second time:—

The House divided: Ayes 181, Noes 148.

[For Division List 42 see c. 809]

Question accordingly agreed to.

Bill read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

Orders of the Day — TRANSPORT (FINANCIAL PROVISIONS) [MONEY]

Queen's recommendation having been signified—

Resolved,
That, for the purposes of any Act of the present Session to provide for grants to the British Railways Board and the National Freight Corporation and to increase the borrowing powers of the British Waterways Board, it is expedient to authorise—

(a) the payment out of moneys provided by Parliament—

(i) of grants to the British Railways Board not exceeding £45 million in total, in respect of any relevant deficit, as defined in that Act, of the Board's railway undertaking; and
(ii) of grants to the National Freight Corporation not exceeding £50 million in total, towards so much of the Corporation's expenditure as cannot be met from other sources of finance;

(b) any increase in the sums payable out of the National Loans Fund or out of or into the Consolidated Fund which is attributable to provisions increasing to £20 million the aggregate amount which may be outstanding in respect of—

(i) the principal of any money borrowed by the British Waterways Board under section 19 of the Transport Act 1962; and
(ii) the Board's commencing capital debt, as defined in Part II of that Act.—[Mr. David Stoddart.]

Orders of the Day — TRANSPORT POLICY

7.13 p.m.

The Secretary of State for Transport (Mr. William Rodgers): I beg to move,
That this House takes note of the Consultation Document on Transport Policy.
I hope that the House will allow me to start with a reminiscence. As Hansard for the 1962–63 Session shows, transport was one of my principal interests as a new Member, and I much appreciated the kind remarks of my hon. Friend the Member for Leicester, East (Mr. Bradley) earlier today. The problems were many and, as a new Member, I thought that I knew most of the answers. But wideranging debates on transport policy were rare even then, and when one arrived, on an occasion such as this, I was prepared. At 3.30 pm I was in my place—and at 9 o'clock I was still there. I had not been called.
All hon. Members will have experienced what is a very common sense of utter frustration, but perhaps it was greater for a new Member who did not know then how common the experience was. I thought "What is the point of being in the House and knowing all about transport if I am not called in a debate?" Confident that the Speaker was out of his mind, I wrote him a defiant note and took it to the Smoking Room to canvass sympathy. I showed it first to Mr. Roy Jenkins, until recently my right hon. Friend the Member for Birmingham (Stechford), who is no longer with us. He read it and passed it to my right hon. Friend the Member for Grimsby (Mr. Crosland), now the Foreign and Commonwealth Secretary. He read it, then tore it up slowly, saying "Have a drink. Sleep well. Tomorrow you will feel better."
Tomorrow has been a long time coming but, more than a dozen years later, I take a very special pleasure in having caught your eye, Mr. Deputy Speaker, so early in this debate. [AN HON. MEMBER: "Not the same speech, I hope."] I hope not to make the same speech but at least to make up for the lost time in the locust years in between.
Coming back to transport policy, I find that everything has changed but much has remained the same. The problems are more acute and some of them are new. But the debate on the relationship


between road and rail and between public and private transport goes on. There is still the urban problem and still the rural problem. The jargon is often familiar but seldom very helpful. I confess that at first sight my new responsibilities are a bed of nails.
There are probably more lobbies in transport than in any other area in which the Government have responsibility. I do not complain about that. Everyone has the right to make his voice heard and to ensure that his view receives attention. But, similarly, I have a right to ask that those who wish to contribute constructively to policy making should show open-mindedness. I say this because the transport scene is complex, and many elements must contribute to an effective transport policy, wherever the balance may be struck.
To put it another way, the great majority of households use public transport as well as the private car. They ride in buses and in trains. They depend on the movement of goods by road and by rail. At one period or another in their lives they ride a bicycle. They walk to school, to the shops, and sometimes to work. All this may seem obvious, yet all too often the case for one mode of transport is made dogmatically in terms of the shortcomings of another which is no less essential.
The private car, in particular, is a source of what I regard as bogus argument of that kind. Motorists, or those who choose to speak for them, frequently claim to be a beleaguered minority, unjustly restrained by speed limits and parking restrictions. But, similarly, non-motorists, or their spokesmen, sustain this image of motoring as a minority interest, though in this case privileged and unrepresentative. The argument becomes distorted and unreal. The fact is that over 10 million households, which includes about two-thirds of the population, have cars. Both the efficiency of other modes of transport—as I have said, we use them all—and the problems caused by the growth of car ownership are important to us all. No purpose is served by the polarisation of attitudes.
One of the problems involves road safety. There is a range of issues which from time to time demand the attention of the House. The last Road Traffic

Act was in 1974, and since that time the House has had two opportunities to consider the most important single proposal in that respect—namely, that drivers and front seat passengers should be required to wear seat belts. I shall not disguise from the House my great regret at the failure to pass that measure, which would save so many casualties and reduce the economic burdens on industry and the National Health Service.
Another aspect of road safety which causes me special concern is the continuing growth of the problem of drinking and driving. The 1967 Act, which introduced the breathalyser, was one of the most successful measures in this respect, but its impact has now worn off and the problem is now worse than it was 10 years ago, particularly among young drivers.
The issues involving seat belts and drinking and driving generate strong emotions. It is to be expected that the public, and indeed many hon. Members, will have a wide range of views on the merits of any proposals to change the law. Nevertheless, those issues are of such importance that in due course they will need to be tackled.
On the subject of transport policy as a whole, the House knows that in about May I plan to publish a White Paper. This debate is part of the consultation process. My rôle is to listen and to learn, and I shall be making no major policy pronouncements. There is much to which I shall not refer, because if I tried to cover everything I should speak for an intolerably long time. Despite that early reservation, no doubt I shall be condemned for my inevitable omissions.
Our starting point is the consultative document. I wish immediately to take up one criticism that is made of it in respect of planning. I hope the House will allow me to make a further personal comment. Almost 20 years ago I wrote a pamphlet called "What shall we do about the roads?" I would not commit myself to every dot and comma of what I then said—on the contrary. But I emphasised the wider land use aspects of transport planning which had not then become fashionable. In that respect my previous position stands. I agree with those who argue that transport policy cannot be considered in isolation from the wider context of where people live


and work and the patterns of our towns and cities. Even though it is now almost four months since my Department was set up, may I again say that I intend that my decisions shall take full account of wider planning and environmental matters.
Since I arrived in my Department, I have been pursuing other criticisms of the consultative document, along with the principal issues which it raised. My colleagues and I have held meetings with 35 major organisations in the two month period up to mid-December. Our aim has been to see how large a measure of consensus is possible and what scope exists for setting a framework within which transport policy can be developed on a consistent basis, with as much stability as Government can provide. Another aim has been to establish a better understanding of the facts and trends in transport and to get others to face the realities that I and other Ministers have to face.
Let us take the subject of public expenditure. I could have wished that I had inherited an expanding transport budget—or at least that the need for restraint in spending was temporary. But circumstances require a sharpening of priorities and a determination to get the best value for money. That goes for local authorities no less than for the Government in the next year and the year after.
I recently announced details of the Transport Supplementary Grant settlement for 1977–78. I had particular difficulty in considering the expenditure proposals of the metropolitan counties and the Greater London Council, which I had to judge before deciding their grant. I discussed the matter with them and I warned them of the prospects. But they showed themseves ready to accept unpalatable decisions and—with one exception—to reduce their spending plans to reasonable levels. Once they had done that, I for my part accepted that they should be free to allocate funds as they wished. A responsible local option is an important theme in much of the debate about transport policy.
The present Government have made a substantial switch in expenditure away from roads to public transport. The share of public expenditure that goes

on roads has been reduced from 71 per cent. in 1973–74 to 53 per cent. in the current year. Much of the increase for public transport has been in higher levels of subsidy for road and rail, to keep services going, to hold fares down and for concessionary fares. But with limited resources we must consider whether the rise in subsidies can continue, and whether more should not go into investment for the future, with less for subsidy and higher fares.
Subsidy to fares is often right, especially when it has a redistributive effect to the poorer members of the community and those with no means of private transport. That is my view and the view of my hon. Friends. But not all fare subsidies are redistributive towards the less privileged.
This brings me back to the question of objectives in transport policy. First, transport must make its contribution to economic growth. The whole economic future of the country depends—and this is agreed on both sides of the House—on the success of our economic and industrial strategy. For transport this means that we must so deploy our resources within transport that we make the maximum contribution to that strategy. Investment schemes—whether in road, rail or in the docks—must be rigorously scrutinised to ensure that they provide the best return on available national resources.
Secondly, we must take full account of the social objectives of transport policy —the needs of people not only to get to work but also in leisure terms in the fullest possible way. This means the maintenance of effective public transport systems because they are an important part of our cities and towns and in the life and mobility of the community. Furthermore, they are essential for the large minority who are without access to private transport, including many of the old and the young both in urban and rural areas. I shall have little to say about buses on this occasion, but I must make clear that I do not seek to diminish their importance in meeting transport needs as part of public transport. Buses handle nearly a fifth of journeys to work. The bus industry is a convenient and relatively flexible means of public transport which provides a service and is easily adjustable to demand.

Mr. Jim Craigen: I take it that my right hon. Friend on a future occasion intends to place more emphasis on bus transport.

Mr. Rodgers: It depends a little on when the next occasion occurs. We have waited for this major debate for nine years. I cannot be sure that I shall be in my present office at that time in the future. If an opportunity occurs, I shall be happy to expand on the matter.

Mr. Eldon Griffiths (Bury St. Edmunds): The Minister properly said that economic growth should be one of the first principles of any transport policy and that social considerations should follow closely alongside them. Does he not think that the switch of resources away from the roads that carry the bulk of our freight has gone too far? Does he not think that a shift in the figure from 7 per cent. to 50 per cent. is taking that process a little too far? Will he examine the situation and, if necessary, put it right?

Mr. Rodgers: If the hon. Gentleman will be patient enough to wait until the end of my speech, he will at least hear some remarks relevant to those considerations. It is a difficult balance. We must not neglect investment in the fibre of our economic life but, equally, we must ensure that our transport system helps to meet social needs. I have already said that there are sometimes questions of conflict. Not only is it a matter of balance—a matter of our changing the emphasis if not from year to year but from period to period, depending upon where the area of neglect is greatest; we must do so with contracting resources. We must face whatever our particular commitment may be within the transport sector.
The objectives sometimes conflict. There is, of course, the environmental factor, which is not quite a matter of economic growth or of social objectives, as I have defined them. The appearance of our towns and of the countryside and the quality of life generally is greatly affected by our policies for public transport, for roads and for the traffic using them. However, we should keep our objectives firmly in mind. Our transport system must serve our people, directly in terms of mobility and indirectly through the contribution it makes to rising living standards, in the fullest sense.
Against this background, I turn to three matters which are central to transport questions. Given the limitations on time, I hope that the House will understand that I shall not be able to deal as adequately with them as I would otherwise prefer.
First, the railways. As a result of the Chancellor's statement of 15th December, there has been a reduction of £13 million in PESC terms in support for the railways, still leaving some £416 million in central Government support in 1977–78. Having previously warned the House that the existing level of support might he difficult to defend in our present economic circumstances, I am glad that the cut is no more severe than that. As I said at the time, the Chairman of the Board shares my hope that this saving can be achieved by reductions in costs and will not of itself require additional fare increases in 1977.
The Board has in mind, all things being equal, to hold fares at their present levels at least until the autumn. The key to railway finances is the control of unit costs, and the Board has acted, with the full understanding of the trade unions, to achieve this. The fare increases which took effect from this month have followed the Board's policy that fare levels should not fall behind inflation. By such means, the Board not only succeeded, in 1976, in keeping within the expenditure ceiling imposed by the Government on support for the passenger railway; it has budgeted to keep its claim for grant in 1977 within the ceiling imposed for the year.
I hope that the House will want to pay tribute to both management and trade unions for making this policy work. All railwaymen have a great deal to be proud of in this country and we have reason to be proud of them. Ministers of Transport are fair game at all times. It is part of the political process. But those with day-to-day responsibility for the railways—at every level—sometimes become the object of unfair and niggling criticism.
I remind the House that in recognition of the changing needs of the railways, I announced last month a radical reconstruction of the Railways Board. This has been carried out under the guidance of the Chairman. Mr. Peter Parker, with the aim of creating a tauter management structure and putting the Board directly


in charge of the conduct of its major concern, the railways business. I have increased the number of career railwaymen on the Board and agreed to the abolition of one layer of management. Mr. Parker places great emphasis on the need to involve the railway unions in developing new policies. I was not surprised to hear my hon. Friend the Member for Leicester, East, who is a distinguished trade union leader, say that the relations between management and unions are now notably better than in previous years. There is also, I believe, a new spirit of co-operation and understanding at all levels between my own Department and the members and officers of the Railways Board.
I mention in passing two important decisions that I have recently announced—namely, the electrification of the St. Pancras to Bedford line, at a cost of £80 million, and continued support for the Tyne and Wear Metro. The latter, in particular, raised awkward problems but, in different ways, both decisions should be seen as a practical demonstration of faith in the future of public transport and its advancing technology.
I turn, next, to a group of related issues Involving lorries, traffic and the motorist.
The consultation document repeated the proposals for a system of national lorry routes to ensure that the maximum use is made of the country's better roads. The consultations we have had about these proposals have shown, however, that there is less enthusiasm for that idea than might have been expected among local authorities and environmental groups.
I shall continue to give much thought to the problems caused by the heavy lorry, to which reference was made earlier, and to the need to "civilise" it and its behaviour as far as possible. We must continue to seek to minimise environmental problems by building such new roads bypassing towns and villages as resources permit, by our continuing efforts to make lorries quieter and less smelly, and by encouraging local authorities to use their traffic management powers to tackle local problems. We still have a long way to go, as I think the House will agree.
Another important issue for me is the extent to which it will be desirable to restrain road traffic in towns. Congestion

has not increased to the extent that many people feared it would five or 10 years ago, but a degree of restraint is inevitable if the hearts of our cities are not to be torn out by expensive and destructive road building. Policies on traffic management and the application of parking controls are rightly a matter for local decision and local option. In devising them and in implementing them in ways the public accept, we must seek to strike a balance. I do not welcome excessive regulations, and all the apparatus that goes with bureaucracy. But I am in favour of local authorities using the range of their powers and influence, and experimenting, when traffic conditions require it and when they are appropriate to local circumstances. They should be seen to be making the choice and taking the responsibility.

Mr. Peter Fry: In view of what the right hon. Gentleman was saying about local authorities taking decisions on parking matters, will he explain why he came to his recent decision not to have a public inquiry in respect of the GLC's proposals on controlling parking when the two London boroughs concerned apparently had great reservations about the scheme? Would it not have been a far better idea for there to have been a public inquiry so that all local authorities could have put forward their point of view?

Mr. Rodgers: The hon. Gentleman anticipated my next remarks precisely. I was going to say, and will say partly in answer to his question, that an example of the scope for local authorities to act within the powers entrusted to them by Parliament—as the hon. Gentleman knows, the powers which he mentions were the result of a measure passed by the House in 1969—arose from the current proposals of the Greater London Council to license public off-street car-parking in central areas of London.
As the hon. Gentleman implied, I had a statutory duty to have regard to representations about the proposals and to decide whether to intervene. It was not an easy decision to make and I had to consider all the factors, including the immediate consequences of my decision and the processes that would follow on. However, I took the view, bearing in mind all the safeguards that exist in


legislation and because the GLC is a local authority and subject, as we are, to decisions from time to time by the electorate, that it would be wrong to intervene in the circumstances.
I think there is much merit in such experiments, but I hope that they will be seen as experiments. I hope that everyone will contribute to seeking to strike the right balance and to make a success of them. I hope that opinions will not be unreasonably polarised without full and careful consideration of the factors involved. I shall be happy to discuss the matter further in greater detail if the hon. Gentleman wishes, but I think that all the factors which came into my decision will be found to be justified if they are carefully reflected upon.

Mr. Robert Adley: Does the right hon. Gentleman intend to say more about local authorities having more power? If not, will he say a word or two now about the rôle of the Traffic Commissioners and the recommendation that their powers be transferred to local authorities, to bring more local choice and local reflection of circumstances into the decisions?

Mr. Rodgers: I had not proposed to refer tonight to the Traffic Commissioners. I shall be happy to listen to the views of hon. Members on the matter, as I have been to hear the views of all those who have been reporting to us on the basis of the consultation document. I am not currently persuaded that there is a need for change in the rôle of the Traffic Commissioners, but I hope that my mind is as open as I have been asking other people to make theirs.
Finally, I turn to roads and particularly the problems of major road schemes. I appreciate entirely the anxieties of those who find their homes, their habits and their community threatened by a proposal for road works. Many schemes are endorsed, by common consent, with a minimum of objections and with the support of right hon. and hon. Members. If the trunk road programme were to be halved tomorrow, the outcry would greatly exceed the sound of rejoicing. My hon. Friend the Under-Secretary and I and our predecessors have been familiar with the representations of hon. Members on this point. So let us have a sense of perspec-

tive. The greater demands made upon us through elected representatives are to move forwards with major road schemes rather than to hold them back. But there is a genuine sense of grievance, which disturbs me. We shall not remove its causes overnight.

Mr. Bruce Douglas-Mann: I was glad to hear what my right hon. Friend said on that subject, but the Public Expenditure White Paper envisages expenditure on trunk roads of £261 million in 1979–80, whereas paragraph 3.23 says that our oil supplies are certain only to the end of the 1980s. Why does my right hon. Friend consider it appropriate that we should plan roads so far ahead? Would it not be better periodically to review proposals for building particular roads, so that the blight imposed by schemes might be removed when it was clear that there was no longer a need for them, or that the resources to make them usable might well not be available by the time they were to be built?

Mr. Rodgers: My hon. Friend puts his finger on a fundamental point, about which I shall say a further word. I do not dispute the need continually to review the road programme, to take nothing for granted, and to ensure that it meets our needs and does not have an excessive demand on our resources. As my hon. Friend will understand, this is a minor point, in that the major matter to which he referred concerned the road programme, but I ask him not to rely on the figures in Cmnd. 6393, last year's Public Expenditure White Paper, because as a result of the announcements last July and December, there have been substantial reductions in the expenditure on roads forecast at the beginning of last year. Given the reservations that people have, their anxieties and sense of grievance, I hope that we shall be able to make progress and find a more sympathetic view being taken on necessary decisions, again, without prejudice to the much larger issue raised by my hon. Friend.
There is close and continuing co-operation at all levels between my Department and the Department of the Environment on common issues of transport and planning. Environmental and planning issues will continue to be weighed alongside narrower issues of transport efficiency in


choosing the route and design of new roads. The appointment of inspectors for trunk roads and motorway schemes and final decisions on them is now shared by my right hon. Friend the Secretary of State for the Environment and myself. We shall consider what further needs to be done on inquiries as a result of, for example, the Council on Tribunals' current work.

Mr. Nigel Forman: Does the Minister accept that it is not only a question of scarce resources but of the crushing burden of uncertainty on many of our constituents, particularly in South London for those of us who are affected by the M23? Can he hold out any hope of a way in which planning permissions received by authorities for such motorway proposals lapse after a period if there is no clear prospect of the projects' going ahead?

Mr. Rodgers: I have a great deal of sympathy with what the hon. Gentleman said. I am not one to follow one of my elders and betters in remembering dates and quoting what I have written, but I referred earlier to my pamphlet "What shall we do about the roads?" I remember saying there that it was ridiculous that it should take all of four years from conception until a major road was on the ground, and I asked whether the lapse of time should not be shorter. Either as a result of the naivety of youth or the way in which matters have changed since I wrote that, the time is now longer. But the more one consults, the more one seeks to carry people with one, the longer the process becomes. One indicates one's intention and asks people what they think. Next one produces the scheme, and then there is a public inquiry, which may be interrupted. Then one thinks again, and there is another public inquiry. We are then talking not of four years but perhaps nine, or even 15.
It is very difficult to have the adequate consultation that people require, without delay and blight. But I shall bear in mind what the hon. Gentleman says, because from the point of view of anybody on the ground it is a crushing burden. I should find myself despairing of long years of uncertainty about whether I could stay where I was living and what other new factors I should have to deal with.

Mr. Phillip Whitehead: As my right hon. Friend hinted, some inquiries have been interrupted recently. There are two brief paragraphs in the consultation document on providing a more independent assessment both for motorway planning and for the presentation of the Department of the Environment case. The conduct of the inquiries was not seen to be impartial by many people. Will these proposals be in my right hon. Friend's forthcoming White Paper?

Mr. Rodgers: I have said that the Council on Tribunals is considering the form of inquiries and whether it could be changed. I was about to refer to the second point in my hon. Friend's mind, about the appraisal of schemes. With the consent of the House, I think that I had better now continue to the end of my speech without giving way again, or there will be little time for other hon. Members to take part in the debate.
I agree with what my hon. Friend the Member for Derby, North (Mr. Whitehead) implied about methods of appraisal for road schemes, the need to make sure that traffic forecasts are soundly based, and the wish to carry more people with us in the decisions which we then make. For this reason, acting upon what was said in the consultative document, I have set up an independent committee under Sir George Leitch to advise me on these matters. I shall shortly announce the names of the other members. With Sir George's agreement, I want the committee to include someone who can contribute out of particular concern for planning and the environment. I am sure that many people and interests will wish to let the Committee have the benefit of their views.
What we have in the matter of roads—illustrated by the interventions as much as by what I have said—is a series of dilemmas. People already spend about £5,000 million a year—about 10 per cent. of all consumer expenditure—on some form of road transport. The number of cars on the roads is still increasing by well over 100,000 a year. But public investment in roads is contracting. The December cuts once again fell heavily on the road programme. Next year's expenditure on trunk roads has been


reduced by a quarter from the level planned in the public expenditure White Paper last February.
Yet the less we spend, the longer we have to put up with traffic delays. Industry has represented strongly to me that investment in transport infrastructure, in particular adequate roads to ports and bypasses, is necessary for its needs as the economy picks up. Road schemes are normally expected to show a return of at least 10 per cent. and frequently they produce a return as high as 20 per cent. in real terms.
We should not reduce decisions on road policy merely to a matter of formulae and expenditure. Decisions on roads involve major questions of national economic, transport and environmental policy. I hope that all these aspects will figure in today's debate, for Parliament has been criticised in the past for being too little involved in how the money voted to roads is spent. I would also welcome hon. Members' views on the idea of an annual White Paper on the road programme which could provide Parliament with an opportunity for a regular review and debate.
I am sure that in transport policy Parliament should have a more central and important part to play than it has been able to in the past. We spend much time discussing local questions which are rightly our concern as constituency Members, but all too little on broader issues and objectives.
I should welcome hon. Member's views not only on the specific question of the White Paper on the road programme but on ways in which we can more effectively involve Parliament in the decision-making process.

Mr. Ronald Atkins: Will my right hon. Friend couple with his White Paper on the road programme a White Paper on railway investment, so that we can discuss that as well?

Mr. Rodgers: It is a chastening experience, when one is trying to be helpful, to find my hon. Friends suggesting how one can move even further in that direction by making papers available. I agree with my hon. Friend in so far as the reports of the British Railways Board, and, the work of Select Committees, do not provide a suitable basis for discussion.

I am glad that my hon. Friend has made the point.
What I am trying to suggest is that at present we have documents upon which the House can discuss railways matters and absolutely rightly. Some people who perhaps believe that our decisions on roads are not well based feel that there should be some further means by which the House can discuss these matters. Like my hon. Friend, I am anxious to see as much information made available as possible.
We are at the beginning of our six-months' presidency of the EEC. I want this period to be one in which we can make real practical progress on the important transport issues for the Community. Next week I shall address the Transport Committee of the European Parliament. I want to be able, in all this European activity, to take into account the views of the House on general policy and on specific items. For example, the new social regulations, dealing with the hours and conditions of the drivers of goods and passenger vehicles; the Commission's freight market proposals; the harmonisation of safety and environmental regulations for motor vehicles. Discussion of these issues, and of the general aim for a common Community transport policy, must reflect the different national backgrounds to the transport policies of the member states and not least those of this country.
As I warned the House, in my remarks this evening I have not systematically followed the consultation document in making a comprehensive review of transport policy. I would be happy if the debate went wider than the matters I have covered.
There is, for example, the question of the organisation or re-organisation of transport. I have no wish to avoid responsibilities that are properly mine. Similarly the House of Commons is jealous of its central role in subjecting the decisions of Government to scrutiny.
I am sure that no one would wish to devise an extra-mural, extra-parliamentary forum for discussion or decision merely to escape from the awkwardness and unpopularity of policy making. But there may be scope for change. In this area, as in others, we should not be afraid to face the unfamiliar.
I come to transport as an enthusiast, fascinated by its complexities and excited by its challenges. I come as a consumer aware of current grievances and anxieties and intending that decisions should be related to economic and to social need. There is no instant formula that will create a wholly satisfactory transport system but I believe that the problems we face are capable of solution. But if we take a long, hard look at realities, then, with a proper sense of purpose, I think that we can move ahead.

7.56 p.m.

Mr. Norman Fowler: This has been a much postponed debate. One result has been that the welcome we would have liked to give to the two new Ministers when they arrived in the autumn has also been postponed. Perhaps I can first repair that omission. I must, however, warn them that it seems that the transport job is one of the more precarious perches in the Government. I took over as Opposition spokesman on transport 12 months ago. Since then we have had no fewer than three Secretaries of State, one Minister of State and two Under-Secretaries. That is an average of one new Minister every two months. I would perhaps be uncharitable to hope that the new Ministers would follow that tradition. But they will perhaps agree that it makes it a little difficult for us to catch up with the present views of each new arrival.
Although the right hon. Gentleman, the present Minister, has not written a book happily we have his 1959 Fabian pamphlet entitled "What shall we do about the roads?" As the right hon. Gentleman was in a reminiscent mood, I shall refer to one of the proposals that many motorists will find most interesting—his support for the idea of toll roads in Britain. In the United States, he said, toll roads were accepted whereas in Britain, he argued
dislike of the turnpike and its abandonment in the 19th century has left a hangover of prejudice against tolls".
We look forward to debating the right hon. Gentleman's ideas on the introduction of toll roads. If it is of any assistance I might be able to persuade my right hon. Friends to make some Supply time available.
The opportunity for this debate is welcome, and for the reason that one of the most serious effects of the rapid turnover

in Ministers has been the uncertainty about how the Government viewed their own paper.
The right hon. Member for Grimsby (Mr. Crosland) produced it, but his immediate successor—the right hon. Member for Stepney and Poplar (Mr. Shore)—was less than overjoyed with it and stressed that it was only a discussion document that had been published merely for debate. We should be clear from the start that it was much more than that.
For example, the consultation document discusses the popular belief that it is possible to secure a massive shift of long-distance freight from road to rail. Alas, says the document, "it is a pipe-dream". That is considerably more than feeling one's way to a tentative conclusion. It is more than that, of course. The popular belief, dismissed so summarily, was until then the official policy of the Labour Party. Again, on the freight deficit, the Government have already made their view clear about the fact that there is no justification for subsidy going to rail freight.
But the document fails to set out an approach to transport policy. In the main, this is because its authors felt constrained by the often repeated pledge of their party for an integrated transport policy. There is precious little in the document about an integrated transport policy, and one of the omissions from the speech of the Secretary of State was that he did not mention the concept of an integrated transport policy. If that shows a change in style and approach, we welcome it. But if this consultation means anything, it means a new start at a time when public transport is in crisis and many of the transport industries face major difficulties.
The trouble with so much of the present transport debate is that it is dominated by the rival lobbies—the rail and road lobbies. Too often, it is a matter of the providers of transport pleading their own case. One example was the response of the British Railways Board to the document arguing that the EEC rules on drivers' hours and distances should be implemented. This had nothing to do with a touching concern for drivers' hours and conditions. It was because it would make road haulage more expensive and thus allow rail freight charges to be increased.
The person who gets left out of such a policy is the customer who has to pay. We all recognise the right of the providers to put their case as long as it is also recognised that the two most important groups of people in the transport debate are the users of transport—the passengers, the commuters, the many millions for whom some form of transport is a necessity, the motorist, the customer who needs to move, and the taxpayers who increasingly are asked to finance so much. It is their interests which are paramount and, above all, any transport policy should seek to meet their interests.
I suggest that, if we take that view, it becomes the proper starting point of the debate and leads to natural conclusions. A transport policy which puts the user first should not tolerate unnecessary legal restrictions which stand in the way of that public demand being met. Here we have a curious divergence of policy. In road haulage, we have one of the most liberal licensing systems in the world. Entry into road haulage is infinitely easier in this country than it is in the rest of Europe and in the United States. The result is that we have a private sector road haulage industry which is highly competitive and highly efficient.
When we come to passenger transport, we adopt an entirely different approach. It is a pity that the right hon. Gentleman did not refer to it. We have a licensing system which was laid down in 1930 and which prevents new services from developing naturally. In my view, it is patently out of date.
Anyone who doubts that statement should attend a traffic commissioners' hearing. One of the nearest is at Acton. I went there a few weeks ago. The case concerned a private coach operator who wanted to develop a new service. The objectors were National Travel, part of the National Bus Company, and British Rail. The House will recall that one of the purposes of the licensing system is to protect the routes of existing operators. The routes to which NCB and British Rail objected were to go not from London to Birmingham or from London to Leeds but from London to Moscow, from London to Vienna and from London to Barcelona. In other words, the private operator was trying to develop a

service like that of the Greyhound coaches which operate in the United States. He wanted to develop a new service.
Objection was made possible because, for the first tiny part of those journeys, the route ran from London to Dover, and the case of National Travel basically was that here was an operator doing something new. It was totally irrelevant to it that such a service would enable the public to travel cheaper. The user did not come into the argument at all. The name of the game is to oppose the plan of anyone who wants to move, irrespective of whether it has any effect on one's operations.
I must say frankly that it seems quite ludicrous that we should have a system which allows that kind of objection—a system which was designed for the Britain of the 1920s. Equally, I believe that it is ludicrous that teams of legal and transport advisers should turn up at traffic commissioners' hearings with the intent only to stop innovation.
The system also affects services in this country. In some cases, it is true that an operator can apply to develop a service with some chance of success, although it is also true that he has to pit his ability to pay against the big battalions. Even when an organisation has the resources, it must contend with the delays of the system itself.
Here, there is the example of the Oxfordshire County Council scheme. The county council was told by the National Bus Company that it would require a subsidy of £330,000 to provide 18 rural services which carried, the county council discovered, 75 people a day. Not surprisingly, but significantly with no help from the Department of the Environment, the county council looked for cheaper solutions. Local groups were set up and an effort was made to discover the needs of those who wanted to use the services. In the end, this meant an application to the traffic commissioners. But the county council has encountered delay after delay, and this has been going on month after month. If the criterion is swift response to local needs, the system leaves almost everything to be desired.
The fact is that our present system stands in the way of innovation. In other


countries there are examples of minibus services, car sharing, jitney services, and coach services organised by groups of commuters. They do not replace conventional public transport systems. They supplement them. There is no reason why they should not be allowed to develop here—no reason, especially when the basis of much of the licensing laws was cross-subsidisation which, frankly, is again out of date.
On rural licensing, the record of this Government is lamentable. The modest reforms made by my right hon. Friend the Member for Yeovil (Mr. Peyton) in 1973 were scrapped immediately that this Government took office. For two years they did nothing. Then, in December 1975, they announced the formation of a committee to consider the problems of rural areas. It took another seven months for that Committee to meet for the first time. Now, in the last couple of months, we have a Bill which allows experiments to take place in selected areas.
I do not blame the present Under-Secretary for that. The fault lies with his predecessors. But I blame his Government, and perhaps he will understand why we say that what he is doing is too little, too late.
What we mean initially by putting the user first is getting rid of restrictions which stand in the way of new services developing. In the freight area, we want decisions left to the customer. The Government have a rôle in devising fair track costs for both rail and road. But the rôle of the Government should not extend to seeking to direct traffic. Both rail and road have natural advantages—rail for heavy bulk traffic and road for the many shorter distances in this country. But, in that choice, the man most likely to get the decision right is the customer.
The public interest is best served not by integration but by competition. That point was perhaps best put in a response to the consultation document which said:
We adhere to the view that a market which is too tightly controlled and in which users' choice is severely restricted cannot best serve the needs of either the consumer or society.
That was not the view of the Selsdon Group. It was that of the National Freight Corporation.
If we are to have competition, clearly it follows that proposals for nationalisation must be dropped. In a revealing part of the document, the right hon. Member for Grimsby admitted that nationalisation in road haulage had no relevance to economic recovery. With that, I agree completely. At the same time, the ports industry, which is a sadly neglected area in this transport paper, would also benefit from such an assurance. It was also one of the most powerful arguments against the takeover of Felixstowe, because it would have reduced competition substantially in that area.
Fourthly, if we are to recognise the interests of the user, we should not ignore the interests of the motorist. Twenty years ago, public transport was more important than private motoring but today private motoring is four times as important, in terms of journeys made, than public transport. We should remember that 55 per cent. of all households in this country have cars, and this increases to 70 per cent. in rural areas. No political party would contemplate making a policy which omitted those without cars. Equally there is no reason to miss out those who own cars. It is a curious fact that the Labour Party is committed by the manifesto of 1974
to make the nation less dependent on the private car.
Some of the policies pursued by some councils at local level go far beyond the sensible prevention of congestion—which I support—and amount to an indiscriminate attempt to ban motorists from city centres, including those motorists who really need their cars for business.
I attach great importance to road safety. Obviously the law has a part to play, and we could argue about what should be included in the criminal law on road safety. But road safety goes beyond making laws. We should make an effort now above all to improve training and to prevent accidents. We should encourage schemes such as the RoSPA schemes for schoolchildren, and the advanced motorists scheme to encourage better driving. We should develop a much better road safety training scheme for motor cyclists. We cannot be content to shuffle the problem of road safety on to the police.
A transport policy as a whole must provide for the interests of the users and


must meet certain requirements, including environmental requirements. That is why I attach great importance to the network of national and local lorry routes. Rather than seeking artificially to direct freight from road to rail, we should confine lorries as far as possible to roads which are most suited to them—away from residential areas. Sometimes this is possible but sometimes it is not because the roads do not exist.
The first priority in road investment is to get roads which aid our economic recovery—the economic routeways. After that, we should invest in roads which bring environmental benefit such as bypasses around villages and towns. We hear a great deal from those who do not want roads at any price, but many people badly need bypasses to take traffic away from their areas. The public must be consulted on road plans, and I emphasise the need for that.
We shall examine and support any scheme the Government propose to improve the road inquiry system. I think that the starting point here would be an initial debate in this House on the issues involved, followed by the kind of annual debate which the Secretary of State has suggested. I think that he put forward a first-class idea, and we would certainly like to take up his suggestion. That is how I would summarise some of the requirements of a transport policy.
When we come to the big public transport operators we must attempt to strike a balance between the needs of the users and the demands of public expenditure. Any Government in present circumstances would have to look for savings in transport, and we support the Secretary of State in his attempts to do that. Any Government would have to look at the justification for subsidy, and once again we support the Secretary of State in stating that there is no justification for subsidising freight operations. We wanted earlier action on this matter, but at least the Department has got the message at last and we welcome that.
With passenger operations the position is more difficult. Over the last two years passenger fares in many parts of the country have doubled. British Rail fares have gone up by 100 per cent., London bus fares by 94 per cent. and

London Underground fares by 114 per cent. Obviously price restraint has had an effect, particularly on London Transport, but the major cause of the fare increases has been inflation. When one has the biggest period of inflation since the war in an industry where between 66 per cent. and 70 per cent. of costs are labour costs. of course fares will rise. Thus what we have seen is yet another effect of the unprecedented inflation which this country has experienced, and equally clearly this Government must bear a major responsibility for their failure to tackle the problem early enough.
These fare increases have no doubt had a cruel effect on hundreds of thousands of passengers, particularly commuters for whom travel to and from work is not a luxury but is essential. Anyone who feels that commuters are affluent members of the middle class who can afford ever-increasing fares should look at a survey carried out in the South-East by the Evening Post, serving Gillingham, Rochester, Chatham, and Gravesend. This showed that no fewer than 77 per cent. of commuters had moved out from London for one reason only—cheaper housing.
I take up a point made by the Secretary of State. He said that in transport matters we should seek areas of agreement. I agree with that. Nowhere is that more important than in developing policies for the railway industry. I have already stated my view on rail freight—a view which in principle, at any rate, the Government accept. My view is that no support is justified. Equally there is no reason why inter-city services should not be profitable. They are good, and in many cases they beat air services for cost and speed.
But to go to the other extreme, it is difficult to see how some commuter services can do without support at this time. The reasons are well known. Commuter services have to deal with two short peak periods of demand with equipment and labour which is vastly in excess of what is needed for the rest of the day. Of course, if we could extend the peaks the problem would be made infinitely easier.
I do not place undue weight on overseas experience, but on commuter services the evidence I have seen persuades me. This summer I spent a month in the


United States looking at the transport system in that country. Although there are railroad companies making money out of freight, the story on commuter services is the same as it is here. In New York, Chicago and San Francisco no one breaks even on commuter services. Indeed, in San Francisco one of the major companies is so eager to get out of business that it is giving away minibuses to any commuter who will undertake to take six or seven others off the railroad, and so enable it to close down the service. The only way commuter services keep going in the United States is by State support.
In any agreed approach to the railway industry I believe that we should follow the advice of The Times which, in a leader last year, set out a programme for economic stability. Referring to the nationalised industries. The Times emphasised that a better financial performance was required—and this was required of British Rail no less than any other nationalised industry. When, however, an industry was required to operate specific uneconomic services it should be recompensed for them. In principle I agree with that approach, but in practice it brings us back to a major obstacle—the identification of specific uneconomic rail services. This is no longer possible because Briitsh Rail no longer identify the costs of separate services. As with freight, this is a major omission for many people. It affects the rail passengers, such as the one who wrote to the Press recently:
If one is to pay one-twelfth of one's salary to get to and from work, it seems reasonable to ask British Rail for an explanation of where the money goes.
It also affects the rail manager. As the Economist said in 1966:
An organisation can scarcely expect to improve its performance if managers do not know if what they are doing makes a profit or a loss.
I mention the 1966 Economist not only because the Under-Secretary was then in charge of its transport coverage but because if that could be said in 1966, how much more true it is today.
But above all it affects a Government who frankly do not know how the money is being spent. As I have suggested, the evidence points to the conclusion that passenger services, including commuter services, are being blamed for far too much when they are not getting

a fair share of the savings which have been made over the last decade.
Again I urge that an essential part of the agreed approach is that the Government must have better financial information on exactly how public money is spent in the railway industry. The taxpayer is now paying over £400 million a year in operating subsidies, but the passenger is facing sharply increased fares. It is in the interests of both taxpayer and user that better information is provided, while for Government it must surely be a natural prerequisite of policy.

Mr. Ronald Atkins: I find some of the hon. Member's remarks confusing. He says that commuter travel is very expensive even in those countries which do not assist freight. He seems to blame freight, saying that the commuters want to know where their money is going, although it is obvious that public travel is expensive and does not pay its way.

Mr. Fowler: I do not want to repeat the speech I made about three hours ago when I dealt with the rail freight deficit, but perhaps I could refer the hon. Member to what I said then when I set out the argument in some detail.
What is clear—and no one should attempt to disguise it—is that over the next year further substantial improvements will be required in the efficiency of British Rail. In particular there will have to be improvements in productivity. Here the response of the British Railways Board is important. In it the Board envisages a reduction in staff of about 40,000 by 1981, most of which can be achieved by wastage and control of recruitment.
Clearly, such a change is important, but where I believe we in the House can help is in emphasising that it is the united desire of both sides that there should be a real future for the railway industry in Britain. Clearly, no system can be immutable, and, equally clearly, we should avoid the American example where, after years of decay, it is costing not millions but billions of dollars to put a basic system back together again.
I therefore want to see a future for the railways in this country. That future lies not only in the hands of Government, but, crucially, in the hands of those working in the industry. What is in the public interest is that we should achieve an


industry which is working to maximum efficiency and is providing the best possible service for the passenger.
Transport is a vital area of government. It is important to millions of passengers and to close on 3 million people who work in it. It is also of growing importance and concern to the taxpayer. The problems are also formidable.
Of one thing I am convinced. Those problems will not be resolved by a crude rail-versus-road slogging match, yet this has been a characteristic of the transport debate in recent years. The consultation document provides us with an opportunity of getting the debate off to a new start. I hope that we shall take that opportunity.

Several Hon. Members: rose—

Mr. Speaker: Order. Roughly 40 right hon. and hon. Members have indicated their wish to speak in the debate. In addition, there may be others who have not yet expressed their intention. There are three hours left for the debate. It will be impossible to get in everyone who wishes to speak. However, I shall do my best to get a balanced debate.

8.25 p.m.

Mr. Douglas Jay: The Minister started his speech by recording how he had attempted unsuccessfully to intervene in a transport debate 14 years ago. My first intrusion into this subject was in the debates on the transport nationalisation Act in 1947. It is a somewhat sobering thought to remember that at that time we all assumed that public transport overall would be able to pay its way and to make a profit, taking one year with another.
Like the hon. Member for Sutton Cold-field (Mr. Fowler) I do not want to speak either for the rail lobby or the road lobby. I want to put briefly to the Minister some specific points which seem to me to arise out of the consultation document.
First, I wish to know why the Government have not yet introduced a higher tax on heavy lorries which the document says on page 26 is justified. The relevant paragraph on that page says that there is a strong argument for systematically relating lorry taxation to resource costs, and then it goes on:

This would mean steeper tax increases for heavy lorries, particularly for those with few axles and high axle loading".
However, the foreword to the document was dated April 1976. We have had at least two mini-Budgets since then in which the Government, so we understood, were desperate for revenue. Why do the Government not then make an increase in this tax since it would provide a benefit in transport terms as well as providing extra revenue. May we have an assurance tonight that this will be done in the next Budget, whenever that is?
Secondly, the whole case for lavish expenditure on new motorway building, which I believe has never really been made out, is further greatly weakened by a careful study of the document. Some hon. Members may not have noticed the remarkably explicit and, I think, wholly justified declaration on page 125 of Volume 2, which says:
Lorries are and will remain a relatively small percentage of total traffic, and their contribution to the case for justifying new roads is correspondingly modest.
That is a statement which most people who drive on motorways will endorse. But it undermines a very large part of the case for a massive motorway programme, a case which has been put repeatedly in recent years—the arguments that motorways are mainly intended to carry industrial goods, to take exports to the ports, and all the rest of it.
We now learn from the document that the case for a new major road has to be made out largely on two grounds. The first is the saving of accidents and the second is the saving of time, mainly in the case of vehicles other than lorries carrying goods.
The first argument, about accidents, is somewhat suspect, because although it is true that on a motorway there are fewer accidents per vehicle-mile than on other roads, the building of the motorway itself in almost every case increases the total volume of the traffic. So we are really largely reduced to the second argument: that the time of drivers of vehicles other than lorries is saved by the building of the new road.
It is interesting to find that the time saved is calculated according to the earning power per hour of the people who are conveyed in vehicles on the road, 30 per cent. of which, we are told, is not working


time in any event. It seems that the better one is paid, the stronger is the case on this criterion for building a road on which one is likely to travel. We should all bear that in mind as part of the criterion which is now used for the most expensive forms of road building.
Another interesting conclusion which emerges from this document is this: if a railway line is demonstrably making a financial loss, a strong case can be made for closing it. But a given section of road cannot be shown to be making a financial loss because, as the document on page 32 rightly points out,
there is no feasible method of associating tax revenues with particular road proposals.
The advocates of a given road—they cannot help this—therefore fall back on the rather more mystical method of so-colled cost benefit analysis which I have just mentioned. But it may be that some railway lines which fail to qualify, because they are making a financial loss, might qualify if the cost-benefit analysis argument were applied to them. That leaves us with a certain inbuilt inequality between the arguments in each case.

Mr. John Lee: I think that I can reinforce my right hon. Friend's argument still further. I put down a Question to the Minister a few weeks ago asking how many roads had been closed for economic reasons since 1950. The answer was "None".

Mr. Jay: That precisely confirms my argument. It is even more interesting to discover that apparently for the first 1,000 miles of the motorway programme, even the cost-benefit system was not used. No rational case was made out at all.
Next, where the building of a motorway causes an increase in the rail deficit, will that deficit, which somebody has to meet, be counted in as the cost of building the motorway? It would seem that it should be included. We spent some hours earlier today discussing the unfortunate rail deficits and what should be done about it then. However, nobody mentioned that one cause of the increase in those deficits was the money that the Government themselves spent on building motorways which compete with rail. The Minister should not neglect that point.
Finally, what precise cuts have been made in the road construction and improvement programme for 1977–78, as set out in the last public expenditure Blue Book dated February 1976—"Public Expenditure to 1979–80"? That Blue Book gave expenditure, both national and local, on new road construction and improvements, omitting maintenance, as being £681 million for 1977–78. We have had three Budgets since then, but all that the Chancellor told us about the figures in his statement on 15th December was,
New construction will be suspended or curtailed in several other central and local government programmes, including roads, other environmental services, school building, Government accommodation, and capital spending by the water authorities."—[Official Report, 15th December 1976, Vol. 922. c. 1528.]
That was an unclear way of telling us what change there has been in road expenditure. My right hon. Friend said that there was a reduction of one-quarter below the figure set out in the public expenditure Paper. If he means that, as a result of all the Budgets since then, one deducts 25 per cent. from the figure of £681 million, that would be an answer. I do not know whether he wishes to confirm that.

Mr. William Rodgers: That was not what I said. If my right hon. Friend will refer to a Question which I answered on the day following the Chancellor's statement, he will get the detailed answer to his question. However, it would be most helpful if my hon. Friend the Under-Secretary of State, when he replies to the debate, could give the House all these figures, because I understand that there may be some confusion.

Mr. Jay: I hope that he will be able to do so.
If we are serious about public economy when dealing with public expenditure on motorways or other major road projects which have not yet been started, mere suspension or curtailment is not good enough in every case. In some cases, outright cancellation is needed. In my view, high priority should be given to new road building in areas of genuinely high unemployment. But I could mention other examples—the hon. Member for Carshalton (Mr.


Forman) mentioned South London—where cancellation would not only be warmly welcomed by large local communities, but would save the Government many millions of pounds and help cut down the public sector borrowing requirement.

Mr. Adley: I hope that the right hon. Member for Battersea, North (Mr. Jay) will not think me discourteous, but would it not be advisable for him to mention that he is one of the few privileged people in the House and in the country who are old Wykehamists and that he is a leading campaigner in the anti-Winchester bypass campaign? That might help us to understand his views.

Mr. Jay: I am grateful to the hon. Gentleman for reminding the House that the proposed M3 motorway past Winchester to Southampton is one of the schemes that might most usefully be cancelled.
I would also like to confirm and support what the hon. Member for Carshalton said about the case of the M23 proposed extension northwards from Hooley into the built-un London area of Mitcham. There is no doubt that if the Minister cancelled that scheme and ended the blight that has affected that part of London for many years there would be universal applause. I think that the hon. Member for Carshalton can confirm that.
I want to impress on the Minister that I doubt whether his Department has ever grasped the strength of feeling about the continuing blight and uncertainty that has existed over a long period of years in some of those cases. It is not just a matter of holding public inquiries as the Minister has suggested. The trouble is that in some cases like this no decision ever seems to be reached. If the Minister wants other concrete examples of schemes that could usefully be cancelled I will gladly supply them.
There are, however, many sections and a number of arguments and conclusions in the Consultation Document with which I entirely agree. If the Minister is able to give a satisfactory answer to the points that I have raised, I hope the House will wish him a favourable journey on a not-too-expensive road system.

8.37 p.m.

Mr. Donald Stewart: The Minister will not be surprised if I confine my remarks to Scottish transport. The consultative document is uninspiring and lacking in relevance to Scotland. The rôle of transport in facilitating or initiating economic change is hardly touched on. There is the same old deference to existing transport interests, whether or not they serve the public interest. It is disturbing that the document shows a lack of appreciation of the differences between the Scottish and English transport situation and needs. I shall give an example in relation to railways.
It is a matter of common knowledge in Scotland, and a matter of some resentment, that antiquated and rejected rolling stock is used on many Scottish lines. When I make railway trips in England I never find stock that is as dilapidated as that in Scotland. I am not arguing that more bad stock should be used anywhere, but I do not see why Scottish lines—particularly those in the North—should be the dumping ground for clapped-out material.
Because of the terrain in Scotland, and other factors, we should have more railways rather than fewer. The railway unions themselves have stated in their document "Railway Developments in Scotland 1976–81" that
The general levels of investment in the railways in Scotland over the last few years has, generally speaking, been below the proportionate level of the Scottish network".
Many lines were chopped under the Beeching regime, which is now regarded as one of the greatest economic disasters ever to have struck the country. I agree with previous speakers that it would be undesirable and counter-productive to enter the road versus rail argument in a way that would polarise discussion, but I confess that I am of the school of thought that believes that more freight should travel by rail than by the road than at present. Much cargo ought to be carried by rail, and the Government should introduce statutes to compel certain loads to be carried by rail for greater safety and for the benefit of the environment.
The costs and inadequacies of the shipping services on the west coast of Scotland and to the islands in the North are a drag on development and are pushing up the cost of living to the level in


London. The local authority has had to give its workers a weighting allowance of £3·50 a week, and its example has been followed by other authorities and firms in the area.
A much better economic basis has been given to Norwegian islands, which are even further north—including some inside the Arctic Circle—by actions taken by the Norwegian Government to help them to survive.
I urge the Government to accept the recommendations of the Highlands and Islands Development Board in its report "Roads to the Isles" which contains details of road equivalent tariff which fair-minded people would accept as reasonable.
I am glad that the consultation document acknowledges that air services in Scotland are an important basic means of communication. However, the excessive fares in Scotland make travel per mile from Stornaway or Benbecula to Glasgow almost twice as expensive as travel per mile from Glasgow to London. British Airways tell me that they cannot reduce fares because the load factors are less than 50 per cent.—but this has come about only in the last two years and has been caused by excessive fares.
I suggest to British Airways that if they reduced fares to a level which people could afford, the load factors would increase and the airline would be taken out of the red or at least put in a better financial position.
There is in the document ignorance of and a lack of concern for the transport problems of Scotland. There is little Scottish data. Figures for the south-east of England are used to justify the unjustifiable in Scottish terms. An integrated transport system is desired, but the means are not given to a devolved Assembly to enable it to create one.

8.43 p.m.

Mr. John Ellis: After a late sitting yesterday, some of us may have been bad tempered and perhaps inclined to be slightly critical of your rôle earlier today, Mr. Speaker.
I want to express my gratitude for having caught your eye now. The sun of natural justice has shone through and though it is rather late in the day it is welcome.
The Minister said that he would issue a White Paper later this year and presumably this will reflect some of the thinking in the consultative document. There is a special factor in my constituency which I hope will be taken into account when decisions are taken.
The transport infrastructure of my constituency and South Humberside will be affected by the opening of the new Humber Bridge. It was recently announced that the cost of the bridge, including the immediate approach roads, was now estimated at £54 million—at August 1976 prices—and that the anticipated opening date was now March 1979. For the benefit of those concerned with planning and the implications of the bridge on investment the toll should be established at an early date. The toll will have a major effect on many other decisions.
I have always been against toll bridges as such. I have never understood why people should have to pay a toll just because they have to use a bridge rather than a road or motorway, although I recognise that it can be expensive to build a bridge on difficult terrain.
I have been investigating the prices of the other 16 toll bridges in the country, two of which were constructed this century. Leaving aside the two constructed this century, the average price for a motor car is about 5p. The Tamar Bridge cost £2 million to build, and the tariff there is 15p. The tariff on the Severn Bridge, which cost £17 million to build, is 12p. The Humber Bridge is already costing £54 million, and the philosophy appears to be that the cost must be recovered. If the figures for the Severn Bridge were used the toll for the Humber Bridge would be £1 but if the Tamar Bridge was used as a comparison the toll would be £4. Those figures are unacceptable and I should react with some violence if a tariff of that magnitude were imposed.
I am a realistic man and I know that we cannot have a free bridge, but I repeat my plea that the toll should be reasonable, and should be announced as soon as possible.
Other implications arise because the infrastructure in the area will be entirely changed. For many years we have been served by a ferry. An Act establishing a steam ferry connection across the River


Humber went through the House in 1846. Queen Victoria, who owned the ferry and the foreshore, received compensation of about £200 a year. In those days the fare for a passenger exposed to the weather was 4d., passengers on the sheltered side were charged 6d., dogs and pigs 1d., coaches with one horse 2s., and coaches with two horses 3s. We should pause to think of the generations of people who gave their devoted service to keep the ferry running in difficult conditions when such equipment as radar did not exist.
Let us not jump to too hasty conclusions about what is to happen to the ferry. Let us plan and let us think. The railwaymen who work the ferry are naturally concerned about their future. The village of New Holland will be affected, because that is where the rail connection is. The bridge will affect the railways, because the rail link comes down to the ferry. It will affect road communications and bus services.
While some have been quick to say "Close down the ferry", or "Keep it going", railwaymen have been very responsible. They have said "Let us do the planning." The Humberside County Council is conducting a survey into the spin-off. There are other factors involved, such as whether it is likely that the bridge would have to be closed because of adverse wind conditions at certain times. I have mentioned a railway serving the villages, and we all know that rural transport services are difficult to maintain adequately. Not all of those who now use the ferry have motor cars. The ferry is right in the heart of Hull. On one side of my constituency, the distance to Grimsby is shorter, but the distance to parts of my constituency from Hull could be a great deal longer by the bridge. There is a great unemployment problem in Hull, but work is available on my side of the river, in the oil refineries, and so on.
This is not a simple matter. There may be a case for retaining a ferry which could carry vehicles. There may be a case for a ferry which could carry passengers only. I am willing to accept that there may not have been much of a case at all. However, I have a feeling that there would have been some case for

retention and that we ought to proceed locally along these lines.
Many people have been involved in the surveys. Hon. Members may imagine my horror when the House rose for the Christmas Recess at the last minute and I got home to find that Sealink had called a meeting of the men concerned in Hull and had said "When the bridge opens, the ferry closes." I say to British Rail that that was the most deplorable example of lack of consultation if it was done in ignorance, and that if it was done knowing the facts, the condemnation of British Rail cannot be too strong.
I am aware that the Sealink division of British Rail makes its money from cross-Channel ferries. What happens here affects the lives of my constituents. The ferry has made money over the years. Perhaps British Rail wants to get rid of it. Perhaps British Rail has its greedy eyes fixed on the compensation that it will get when the bridge opens. In any case, it was deplorable for an industry, particularly a nationalised industry, to proceed about its busines in this arrogant fashion. As British Rail needed an Act of Parliament previously, it may be that it will need other Acts of Parliament. I assure British Rail that it is net likely to get my co-operation in any such endeavours if this is the way in which it proceeds with its business. I think that that is a fair point to make.
I look to British Rail to reconsider its attitude regarding these matters. Let us have the job done properly and well. British Rail has succeeded in alienating public opinion in my area, at every level, by this kind of action, which was thoughtless, at the least—and if it was more than that, it was deserving of the most savage action that we can take.
I have commented on the survey in relation to my area. In my constituency we need a co-ordinated approach to all the problems. What will take place there on the opening of the bridge proves the theory that is put forward over and over again in the consultation document. I am a Member of Parliament sponsored by the Transport and General Workers' Union. No one from my organisation, in the studies that we have done—or anyone else, as far as I know—is saying that


there is any point in pursuing the road-versus-rail argument. Both have a part to play.
My constituency produces steel, and it makes sense to move that product by rail. Steel is produced at Scunthorpe, where British Rail has modernised the marshalling yards and the tracks to the Midlands and the South. All that makes sense, and I hope that British Rail will keep a sharp watch on things.
We have done rather well from the point of view of the motorway network, because in our area it is being extended to meet the river bridge. There will be competition with the railways, but nobody minds that. I hope that British Rail will realise that the steel trade is one of the jewels in its crown. It makes a lot of profit from the steel produced at Scunthorpe, and I hope that it will ensure that it keeps this trade.
I thank my hon. Friend for what has been done to help in the provision of roads in our areas. Despite cuts in the road building programme, we have always managed to get our part of the motorway programme coupleted, but there have been difficulties in dealing with the problems of towns and villages. There is still a problem in the Immingham area. A group of my villages are badly affected, and they need some relief. We need a north-west orbital road at Scunthorpe to serve the new network as it comes into being and we get the bridge across the Trent and the motorway. However, I cannot complain over the progress that has been made.
One matter that merits further consideration is referred to in Chapter 4 of Volume 1 on Transport Policy. One sees there a suggestion by the TUC, and it is supported by my union, for a national transport authority. I sometimes think that we in this House have short memories. Some of us went through a traumatic experience during the late 1960s when we were dealing with the Transport Bill.
It has been said that Ministers come and Ministers go, particularly those in the Transport Department. It is said that they suffer a stormy passage. I had the privilege to work as a PPS to the late Stephen Swingler when he was Minister of State. He occupied that post for a long time and, with respect to my hon.

Friend, I think that he knew transport as well as any Minister that we have had with responsibility for this job. Some of us think that Stephen Swingler's death resulted from his marathon work on that Transport Bill. It took an enormous amount of time to get it through Parliament. The measure was hotly disputed, but it became law and provided the Minister with powers which he could invoke by means of orders.
That measure had much merit. It contained powers which could be used in the present circumstances. It was not merely a case of giving a block grant to a local authority and somebody then considering problems relating to buses, or cars, or other facets of planning isolation. It contained ideas about passenger transport associations and passenger transport executives. Those bodies were set up to look at all aspects of the problem, and on them there were members from local authorities, from the police, from road planners, from road hauliers and from the railways. They would consider all relevant local aspects before making a decision.
I think that there was much merit in that approach. There is a lot to be said for economies of scale, with Ministers at the centre knowing all the factors that need to be taken into account, whether it be in an English constituency or a Scottish one, but emphasis should be given to local needs, and use should be made of local planning facilities.
I should like to see the powers under the Transport Act invoked, and I do not think that that would be alien to the TUC's suggestion that there should be a national transport authority to look at all the threads that were revealed.
Decisions should not be taken from the top downwards. Solutions should be based on the problems encountered by ordinary people, whether at work or in business, in the areas where they live, where people are trying to invest or to create more jobs. Let the details be examined, whatever those details may be. Looking at problems in this way, one begins to discern the strands of a problem which has national application and on which national decisions must be taken. Taken together, all these local factors give a firmer indication of national needs. The problem with bureaucracy is that planning decisions are


taken from the top downwards instead of from the bottom upwards. I commend those thoughts to the Minister.
Finally, I ask the Minister to use his influence with British Rail in connection with the boats that run across the estuary, on which we still rely and which will be needed until 1979—certainly if the construction of the bridge is not put back. They are two old boats, the "Lincoln Castle" and the "Faringford". They are paddle-boats which have been in use for many years. The staff are dedicated to keeping them running, but they are breaking down increasingly often, and surveys and repairs frequently have to be carried out. One of them ran into some driftwood in the channel last week and was out of service for a whole week.
I ask hon. Members to be patient with me, because this is a matter of considerable importance to people on both sides of the estuary. If British Rail has any idea that because it will be getting rid of these boats, anyway, it does not matter whether there is a complete service, it certainly has the wrong idea. I hope that British Rail will approach the matter in an entirely different frame of mind, recognising that it has an obligation to provide a service until the consultations have been completed and the full situation taken into account, with an alternative service, if that must come about, and other decisions taken at the end of the day. In the meantime, however, British Rail is under an obligation to provide a reliable, efficient and safe service.

9.3 p.m.

Mr. John Stanley: I am one of those who believe that small is often beautiful and that bigness is certainly no guarantee of being beneficial. Therefore, it did not cause me any particular heartache to see the Department of Transport being fragmented from the rest of the Department of the Environment. Yet, despite that sentiment, the whole thrust of what I have to say goes the other way.
The consultation document's policy on commuter fares in the South-East—which was not referred to at all by the Secretary of State and which, I hope, the Under-Secretary will refer to when he replies—shows a striking deficiency in that transport policy has been planned

in total isolation from planning policy related to London itself.
One cannot sensibly plan a policy for transport into a city except against the background of the planning policy for the city itself, and not for the city as it now is but for the city as it is now changing. London is changing profoundly. The starting point for any rational policy on commuter fares must be the background of how London is changing.
Many hon. Members will have seen the survey in the Economist entitled "London's Burning, London's Burning". It was a grim study of declining population, declining employment opportunities and increasing dereliction. London has effectively been "burning" for many years, if one measures it in terms of a declining population. At one time London's population, in what is now the Greater London Council area, amounted to 8½ million people. The disturbing feature of the current trend is the way in which the depopulation of London is accelerating. No doubt the worst is still to come. The Office of Population Censuses and Surveys shows that in the decade 1965–1975 London's population has declined by 750,000 people, but in the next 15 years up to 1990 London is bound to lose about 1,500,000 people, which will bring the population down to 5·8 million.
The vicious thing about that spiral is that it tends to be self-perpetuating. The greater the decline in London's population, the more parlous London's finances tend to become, the greater the deterioration in London's amenities, and the greater the burden thrown on the residual domestic and non-domestic ratepayers of London. So great is the burden that they tend to move out and give the spiral another downward twist.
It is improbable that this trend will be reversed to produce a repopulation of London, but we must try to reach a level at which London's population can be stabilised. The only prospect of doing so is to preserve in the capital a means by which there can be a thriving, positive centre for those who wish to seek employment in the capital, but who come from the commuter belt areas that ring the capital.
It has been argued that commuters are expendable and not integral to the


revitalising of London—in other words, that they can be safely priced out of the rail system into London. My constituents believe that that has been the policy over the last three years, and that little notice has been taken of their capacity to pay the ever-spiralling costs of getting to work.
It is a mistake to assume that London somehow can gradually do without its commuting population. About 500,000 commuters come into London every day—roughly 300,000 by public transport, and the balance by private transport. They bring into London every day a great deal of money and contribute a great deal to small and large businesses in the capital. The most significant feature about the maintenance of that stream of commuters into Greater London is that, if those people did not make that daily journey, thousands of businesses would have to move out of the capital. If that were to happen at a faster rate than now, it would spell financial disaster for London.
London is being sustained more and more by the yield from non-domestic rates. A recent parliamentary answer showed that the rate yield estimated for the financial year 1976–77 on non-domestic properties in Greater London is estimated to be over £800 million from commercial properties alone. If London were to be deprived of that sum, it is evident that financially London would become totally non-viable. I argue that the only way in which London is to be made to stop "burning" is by keeping the commuter population at something like its present level. That seems to be the only rational basis from which we can start to consider future fare policy.
The document, however, starts and finishes solely within the financial and commercial framework of British Rail. It appears to assume that there will be further steady and substantial increases in commuter fares until 1981, probably over and above the increase in the cost of living. Certainly that applies to outer London commuters.
If we experience between now and 1981 the rate of fare increases that has been experienced over the past three years, it seems self-evident to me that many tens of thousands of commuters, if not hundreds of thousands, will be driven off the railways.
I suggest that there are two essentially false assumptions behind the fare increase policy as set out in the document. The first is that somehow commuters are able to devote more and more of their disposable income in increased fares. As my hon. Friend the Member for Sutton Cold-field (Mr. Fowler) said, it is a myth that when set against their commitments, the commuting population is somehow especially affluent.
The overwhelming majority of commuters in my constituency are people of modest incomes. In many cases they are first or second generation owner-occupiers with relatively modest houses, large mortgages and fixed costs. They are now beginning to reach the limits of their capacity to pay.
The second myth, which is enshrined in paragraph 7.36, is that commuters still have cheap fares. The paragraph states:
After the recent fare increases, season ticket holders are still paying only about 3 pence a mile".
It does not matter to the commuter whether he is paying 2p, 3p, 4p, 5p or even 6p a mile as that is not the significant factor. The factor that bothers him is the relationship between his take-home pay and the amount that he is obliged to pay to get to work. That is the crucial equation, and the equation against which it has now become impossible to put an equals sign.
I use my constituency as an example, and I suspect that it is relevant. In February 1974 the cost of an annual season ticket from Tonbridge into London was £164. It is now £390. That is an increase of 138 per cent. Have people's after-tax incomes increased by 138 per cent. in that period? If they had increased by anything like that amount, it would not be a serious problem.
The truth is that on an after-tax basis—it is the only one on which we can work—incomes have not increased by anything like 138 per cent. The Library has kindly undertaken a study for me, determining what has been the increase in average earnings after tax for a married man with two children under 11 years since February 1974. The increase has been about 50 per cent. compared with a 138 per cent. increase in his travel costs. If that relationship continues between now and 1981, I am certain that is spells death for commuting to London by rail for many tens of thousands.
The whole policy enshrined in the document of increasing commuter fares steadily until 1981 appears to be based on the need to reduce the subsidy payable to British Rail in respect of commuter fares. I do not for one moment question their desirability and, indeed, the necessity of questioning every subsidy in our present economic circumstances. The Government are entirely right to do so. However, the financial thinking is essentially mistaken when the Government's fare policy is based on considering only one subsidy. They should be considering the two subsidies that are directly related to commuter fare traffic.
The Government are considering the subsidy payable to British Rail for their commuter fares. The document states that it is a subsidy of about £80 million a year. They are ignoring entirely the second a related subsidy—namely, the Exchequer subsidy that is having to be paid to London to keep it financially afloat. Next year the Exchequer subsidy to London will be £910 million. It would be ludicrous to try to shave a few tens of millions of pounds off the subsidies payable to enable commuters to work in London, if the price was to prevent them going to London at all and probably in the medium term adding hundreds of millions of pounds to the cost of Exchequer financial support for London.
I hope very much that before publishing his White Paper in May, and deciding his fare policy for commuters, the Minister will consider two fundamental points. First, I hope that he will consider his policy on commuter fares against the planning strategy for London and the vital need to maintain employment for commuters in London if London is to survive financially. Secondly, I hope that he will now recognise that many commuters have already reached the limits of their capacity to pay. In my constituency and many others they are already saying "We can no longer afford to go to London. We shall now work locally." They are moving their jobs. If that process continues much longer it will spell increasing subsidies to British Rail and to London and mean the death of London as an employment centre.

9.16 p.m.

Mr. Walter Johnson: I very much agree with what the hon. Member for Tonbridge and Malling (Mr. Stanley) said about commuter services. What is not fully understood about them is the vast amount of rolling stock required by British Rail, particularly on the Southern Region, to get the hundreds of thousands of commuters in and out of London. As well as the vast amount of rolling stock needed for two or three hours in the morning and again later in the day, staff are needed to operate the services. This means a great deal of expense.
I understand the problem of commuter fares, particularly on the Southern Region, even though it does not concern my constituents. Many young people were advised by their firms to move out of London to the fringe of the area and saddled themselves with a big mortgage. As the hon. Gentleman said, they are now looking for work locally, but many cannot find it, in view of their experience and the jobs they now do in London.
There must be a case for regular subsidisation of commuter services not only into London but into other big conurbations. The policy of the British Railways Board in this direction has been very wrong in recent times. People are finding alternative ways to travel in and out of London, which is making travel more difficult for those who normally have to use other forms of transport, such as cars. Traffic jams are building up all over the place. This is wasteful. Commuter services should be provided at a reasonable cost.
I hope that when he is drawing up the White Paper, and the legislation to follow, my right hon. Friend the Secretary of State will take into account the vital need to keep commuter fares down, in the interests not only of the people concerned but of industry and commerce in the big cities. The series of fare increases in the past 18 months or so has caused great hardship to many young people, particularly those who have been forced to move out of London.
I congratulate my right hon. Friend and my hon. Friend the Under-Secretary on the patient and courteous way in


which they have received the vast number of deputations which have seen them on the consultation document. I am honorary national officer of one of the railway unions. We have been most impressed by the way in which our case has been looked at. As a result of these real consultations we are hoping that we shall get a transport policy that will be in the overall interests of the nation. I believe that we shall see that in due course.
I am not making a speech against road or rail this evening. We ought to be thinking in terms of an integrated transport policy working in the interests of the nation. That is what most of us are looking for. Until now there has been wasteful competition within the nationalised sector itself. We have had the ridiculous situation of National Carriers, Freightliners, British Road Services, British Railways and the Post Office all competing for the same traffic. What nonsense. It has to stop.
There has to be a clear understanding of the need for full and proper integration, particularly within the public sector. I am pleased that there seems to be a new look in respect of National Carriers, Freightliners and the National Freight Corporation generally. I believe they now realise that they have to work together if they are to survive. There are signs that that is happening.
There is also wasteful competition with regard to inter-city services. We have fast inter-city services between London and cities such as Birmingham, Manchester, Glasgow and Edinburgh. Yet we also have shuttle air services, run by British Airways, which are unnecessary and should not be allowed to continue. I did not think that I was being as provocative as the interruption from the public gallery suggests.
We now have a situation where British Rail, the air services and the coach services are all competing for the same passenger traffic. That is a ridiculous situation. I personally believe that it is wrong for British Caledonian to start an inter-city service between Gatwick and Manchester. That is quite stupid because we have one of the finest railway inter-city services between London and Manchester. There is no reason why there should be a duplication of such services.
I hope that my right hon. Friend will also carefully consider the need for a re-examination of the investment policy of British Railways. I hope my right hon. Friend will consider what sort of aid will come from the Government not this year or next year but over a period of four or five years so that there can be proper planning. One of the troubles that British Railways has faced for a number of years is that it has not known what level of investment will be available next year and the year after.
Electrification is being held up. Although the advanced passenger train is working on some services its further advancement, development and technology is not going ahead as quickly as it should. Track modernisation is being slowed down. All this is absolutely vital if British Railways is to compete on a fair and equitable basis with other forms of services.
I believe that there is a strong case for much of the traffic that is now on the roads to be put on to the railways. There should be a proper utilisation of, as well as improved, railway facilities.
Come with me to the M1 motorway. One section outside London has a railway line running by the side of it. On the motorway there are masses of juggernaut lorries going in and out of London, yet on the railway there is hardly a train. One weekend I spent half an hour there and while masses of juggernaut lorries were going in and out of London only one train passed by. There must be a case for much of the traffic now on the roads being put on to rail. It might only mean a marginal increase of about 10 per cent. or 15 per cent. But surely it is common sense to make full use of our railway network. We are not doing that at present.
For example, we should be using the railways for the carriage of all dangerous liquids and chemicals, rather than risking the chaotic situation of bad smashes on motorways, with the accompanying danger to human life.
The freight side of British Railways has been told that it must reduce its deficit from the £70 million that it received last year to £30 million this year and to wipe it out completely next year. I believe this to be unfair competition. I am sure that hon. Members will have


seen the article in The Sunday Times a few months ago in which it was estimated that the damage caused to motorways by juggernaut lorries was costing us £70 million a year—precisely the amount of subsidy at present given to rail freight. By insisting that rail freight should not get any further subsidy but should make ends meet, we are creating unfair competition. The juggernauts and other lorries should pay a proper sum for the use of our roads.
There is much talk about there being far too many railwaymen. There is a great deal of ill-informed and misleading criticism about this aspect of transport policy which is quite disgraceful. Over the years, the railway unions have been extremely co-operative. Productivity schemes have been introduced. There has been a considerable reduction in staff numbers. Real transport problems have been dealt with, and we have very much more harmonious arrangements in being. In 1963, there were 476,000 railway employees. By 1975, that number had been reduced to 234,000. There is no other industry in the country which has made a reduction of that kind and which is still operating an efficient service.

Mr. Fry: I am interested in the hon. Gentleman's statistics about the number of people employed by British Rail. Does he agree that in more recent years there has been only a very small contraction. The very large drop in the numbers employed occurred some years ago. What the hon. Gentleman said about other industries having to cope with similar work forces is not quite as true in the immediate past as it is if we look back some 10 years.

Mr. Johnson: I agree with the hon. Gentleman, but reductions are still being made. He will know that reorganisation schemes are being implemented practically all the time, and their effect is to reduce the number of staff.

Mr. Whitehead: My hon. Friend might have pointed out to the hon. Member for Wellingborough (Mr. Fry) that if the reduction had continued at the level of the period between 1963 and 1970 there would now be no railwaymen left at all.

Mr. Johnson: My hon. Friend is absolutely right. We cannot have the ridicu-

lous situation where we ask for more freight, more passenger services, the development of high speed trains and the advanced passenger train, which should mean more traffic coming to the railways, while we are reducing the work force to such a degree that there is a need for massive overtime. This has been one of the problems of the railways. Staff numbers have been reduced in the wrong areas, resulting in overtime having to be worked. This has meant a greater expense in trying to keep services going.
My right hon. Friend has a rare opportunity to come forward with a White Paper and later, we hope, with legislation which will result in the full integration of our transport systems with the road and rail sides working together in the interests of the nation and not against each other as they do at present.

9.29 p.m.

Mr. Stephen Ross: I begin by congratulating the absent Prime Minister on setting up a Department of Transport. It is one of the best ideas of the present Government. It has given proper recognition to the importance of this complex subject and to the need to take positive and probably unpopular decisions.
Since the publication of the Government's Green—or orange—Paper in April we have all received scores of voluminous documents from many interested parties and private individuals. We have also had a few dummy starts to this debate. I am just about punch-drunk from the effect of reading all the documents and trying to make up my mind.
It is my view that the first question that the Secretary of State must resolve is the future rôle of the railways. Shall we maintain the existing network largely as it is, or shall we consider a further Beeching-type exercise? Some months ago, there was speculation about the latter course in the Press, but it seems to have died down now. I do not wish to enter into the road-rail argument, because that is barren ground, but I come down very much in favour of maintaining the existing rail network and directing our future transport policies by trying to make the greatest possible use of the substantial assets we have in our network. I accept that this must mean a continuation of a


substantial subsidy, but it certainly must not be a bottomless one.
Before they commit themselves to such a policy, the Government must obtain from both management and unions firm undertakings on productivity and overmanning. There is still over-manning, despite what the hon. Member for Derby, South (Mr. Johnson) says, and I know he knows his job. Undoubtedly this is so in British Rail.
I am aware that in both the British Rail and the NUR evidence, the comments of Messrs. Pryke and Dodgson have been challenged, although the British Rail Board's present plans do apparently envisage a gross reduction in manpower of 40,000 between now and 1981. I was at Western Region the other day, and was told that it has reduced its manpower from 65,000 in 1966 to 26,000 today, and it is reducing by a further 1,000 this year. I accept that those are very considerable reductions in manpower. Nevertheless, the information contained in the document submitted to the Select Committee on Nationalised Industries by the Railway Rescue Group is alarming, and is certainly not in accord with section 2.42 of the NUR evidence. I am certain that savings still can be made.
Another requirement of the continuing help to the railways should be greater urgency in rationalisation of assets. British Rail continue to sit on vast acres of unoccupied land, as is evident from a single rail trip. It has been said that it was keeping land for the Channel Tunnel. I agree that great areas of land may have been retained in the London area for that reason, but I accept that British Rail has had problems with planning authorities—it is having one with Liverpool Street at the moment and it was probably harshly treated over Euston. I think that British Rail could do a great deal more with the land, even though it cannot get the large profits from it which could have been realised a few years back.
There is a great need to make railway stations more attractive. They should be centres of activity like Birmingham New Street. They should not be cold places to dodge like the plague, like Portsmouth Harbour on a rainy Friday night or Nottingham at 1 p.m. on a Sunday. Many disused lines and stations are being left to rot. Run down buildings and poor

facilities do not attract customers. I congratulate the Government on their programme of aid for private sidings. They are giving substantial grants to private firms to put in their own sidings. I repeat my call for a siding to be restored to the new Covent Garden site in London.
At Southampton, British Rail is taking two-thirds of the container rail traffic, but I wonder whether it will bid for the South African produce trade when that starts coming in containers later this year. British Rail would be mad to miss that opportunity. It is a marvellous chance to provide a quick service to central London.
I believe that the railways could take a great deal more freight. I do not take the gloomy view of the document, but it is obvious that it would be an advantage to our roads if the railways took more.
I think that the programme of electrification should be pursued as funds permit and this could provide the opportunity for welcome reductions in fare structures, as well as superior services, as instanced by the recently electrified Welwyn-Moorgate service. I am pleased that the Minister decided to go ahead with the St. Pancras to Bedford electrification. I hope that he will now turn his attention to the main East Coast route, where a rolling programme of electrification should be approved.
British Rail has been imaginative with its off-peak, Awayday and pensioners' tickets. It has given a lead to the bus companies, but we are entitled to some information on the whole subject of fare structures. If someone guarantees a full train to Liverpool it can apparently be run at a return fare of £3·50, and I ask therefore why it is necessary to charge as much as £17 or more for an ordinary monthly return. Are Southern Region commuters being penalised to the advantage of others? We do not know because separate accounts are not published.
Inter-City and the high-speed train services are quite magnificent. I do not think that they have been given the plaudits they deserve. We should also bear in mind the rise in morale which comes with the introduction of the high-speed train. To those who have not used it yet I recommend a trip. The staff on the train immediately feel that they are in something worth while. I am concerned, however, that Inter-City may now have started


to over-price itself, and that is something which should be closely looked at.
British Rail seems also to work in separate compartments. Perhaps the changes in the structure of management will do something about that. I make a plea to the new chairman. I went to school with him, although I am not sure that he would be happy to be reminded of that. He left to study Japanese, but perhaps he studied Japanese railways instead and will inject some of their success here. I support everything that has been said about him. He is an able man. My plea is, however, that he will insist on greater co-operation between rail and shipping services. Too often, as I know from my experience, there is a lack of co-operation between British Rail services and Sealink. Living as I do on an island, I have suffered from this short-coming on the cross-Solent services. The boat times do not always seem to coordinate with the trains, and trains are not held when they could be.
Finally, I suggest that anyone who is mad enough to travel on a Sunday or on late night services needs his head seen to. The right hon. Member for Western Isles (Mr. Stewart) spoke about the condition of the rolling stock in Scotland, and British Rail certainly seems to reserve its old stock for services operating after 11 o'clock at night. Not all of us who travel on those trains are drunks or illiterates, and I believe that we deserve something better.
I do not favour handing over the electrified suburban services to the Greater London Council. British Rail should retain management of them. However, there may be a case for examining the Broad Street to Richmond line. If that was taken over by the London Underground and it appeared on the Underground map a great deal more attention would be paid to it, and that could prove most useful.
I have concentrated on British Rail because it provides the key to the whole transport programme. But this must imply that there has to be an integrated system with buses and coaches linked to the stations to a much greater extent than at present. I think that the management and administration of the buses should be restructured to accord with county boundaries, thus providing local authority

participation which is overdue. I would much prefer to see National Bus restricted to controlling the long-distance coaches which also should integrate with British Rail to a much greater extent, perhaps under some joint board.
I believe that metropolitan transport executives should be given the chance to prove themselves. The remaining city bus services, which have been pretty successful through the years, should also be allowed to expand their activities. Too often their services are cut at city boundaries and some of their most lucrative routes are pinched from them.
Public vehicle licensing must be reformed and the smaller operators encouraged by local authorities to move into areas to fill the void left by the withdrawal of larger concerns. Experiments in Hertfordshire, Oxfordshire and Bedfordshire should be studied and extended.
The education authorities which run their own buses should seriously consider whether the vehicles would not be more fully utilised and more cheaply maintained under a small private operator. I suspect that most would be. There is probably a good argument for taxing petrol rather than vehicles. It is cheaper and simpler. But we would have to keep a nominal licence charge, if only to allow some employment to remain at Swansea!
Concessionary fares are a great bone of contention among pensioners. There is a great need for a national scheme to be introduced. We can deal with that matter at greater length elsewhere. However, it is a matter of considerable controversy.
I cannot advocate the idea of a national transport council—it will be another bureaucracy—but, with the likelihood of Scottish and Welsh Assemblies and possible regional authorities in England, there is some sense in having elected regional transport executives to try to coordinate road and rail expenditure on a more sensible basis.
Transport, as the Secretary of State said, cannot be looked at in isolation. It must be considered in the context of land use planning.
If we seriously wish to encourage the return of residents to inner urban areas


—and I understand that is now the Government's policy—our road, rail and bus structures must be designed to fit in with that concept. It should mean more traffic-free precincts, better provision for cyclists, and, above all, adequate footways. Over 41 per cent. of all journeys are made on foot. Planners should pay more attention to the needs of pedestrians and cyclists when looking at development schemes.
I think that the Government should introduce stronger measures of traffic restraint—it would be politically unpopular and the Government would probably need to be elected for seven years in order to accomplish it—with financial and capacity control limitations on private and public car parking, and so on. We cannot proceed in the present laissez-faire manner with bigger and better traffic jams. We had examples of such jams over the Christmas period in London.
Road casualties are unacceptable to me. Regrettably, we have come to regard life too cheaply in this respect.
The new construction programme should be restricted to linking our main manufacturing centres with the ports and to building bypasses around our small towns and villages. The Minister was asked about the Government's present policy on that matter. We were promised a White Paper. I look forward to seeing it. It is a good idea to think in terms of an annual White Paper.
Traffic forecasting is admittedly open to question. The Department's figures over the years have often been proved wrong. They have usually overestimated the amount of traffic which would be using our roads in the years ahead. I have had some interesting graphs prepared on that forecasting.
I appreciate that the Minister's remit does not run to canals. That is a pity, because canals have a role to play. The saddest story that I have read about in recent months was the failure of the "Bacat" scheme to make progress in the Hull area. It is beyond belief that the intransigence of the dockers should have brought about its withdrawal. No Department seems now to be interested in canals. We appear to have given them up altogether and handed them over

to the Minister for Sport. At least he will keep them filled with water.
I suggest that the Secretary of State should concentrate on setting out the general guidelines in his White Paper and should try to obtain as wide consent as possible to his proposals. When the legislation has been agreed, we should leave the professionals to get on with the job. There has been too much political interference.
I should like to come back to a constituency matter—the Isle of Wight railway. The old steam line from Ryde to Ventnor carried 2½ million people. However, on the casting vote of the Minister in the 1966 Labour Administration, that line was castrated at Shanklin. Therefore, it lost a great deal of its throughput. We spent £750,000 on electrification. I listened with interest to the speech made by the right hon. Member for Western Isles. I suggest that he should come to the Isle of Wight. We had 1927 Piccadilly Line tube stock taken from the breaker's yard, transported to the Isle of Wight, and put on our line. What a way to run a railway! It is again threatened with closure, but it is still carrying 1½ million passengers a year—a maximum of 45,000 passengers a week in the high season. If the line were closed it would place an impossible burden on our roads.
I have sympathy for the lady who shouted from the Public Gallery during one hon. Member's speech. I think all the people of the village of Brading would come here to shout if the bus service that goes through their village had to replace the railway, because their lives would become intolerable. There are more licensed vehicles per mile of road on the Isle of Wight than in any other part of the United Kingdom. British Rail may decide to close the line in the foreseeable future, and I give the Minister warning that we will fight tooth and nail. All these troubles have arisen because of a wrong political decision taken 10 years ago. No doubt there are many other similar cases throughout the country.
There has been too much transport legislation. Many transport managers no longer enjoy job satisfaction, and cannot wait to retire. They must be given fresh hope and encouragement, and we look to the present Secretary of State for that.

9.46 p.m.

Mr. Gwynfor Evans: Transport in Wales has not been the success story of any Government in recent years. That is in spite of the fact that we all agree that transport is essential to the infrastructure that is necessary if we are to build a balanced economy. Ever since I began to take personal interest in this subject—and that is a long time ago—I have heard people talking about the need for an integrated system of road, rail and air transport. Yet we do not seem to be any nearer such a system today than we were several decades ago.
There is much public feeling about transport. I can give an example from the area of my own county council of Dyfed. It issued a questionnaire asking people in the county which issues concerned them most. Public transport was the greatest concern of most people. More than 400 said that transportation was their most serious problem. The situation in that area can be judged from the fact that the head of the roads division of Dyfed County Council has said that, given present costs and the expenditure that he is allowed to make, it will take 30 years to macadamise all the roads in the county.
Many people believe that a Welsh Transport Board would have ensured not only less destruction of railway lines but also better development of road, rail and air transport for freight and people. Administrators in London regard Wales as little more than a fringe nuisance. They do not have plans for Welsh development and rarely take any initiative for such development. It is only infrequently that they even take the trouble to inquire into the Welsh situation.
The consultative document, for example, says that rail passengers come mainly from higher income households. That may be true in London and parts of the South-East and Midlands, but it is certainly not true of Wales. Passenger transport there is mainly important to those who travel from the Valleys and they are largely from lower income families. It is because of lack of concern in London that those appointed to executive posts in Wales are often drafted in from England. Often they have no local knowledge of or enthusiasm for Welsh development. For them, jobs in

Wales are just stepping stones to better jobs elsewhere.
An example of this can be seen in West Wales with the unhappy situation in the National Bus Company. That company badly needs reorganising. At present, only the humblest posts are filled by people who know local circumstances and who are enthusiastic for the development of the service in their areas. Yet the majority of employees are local people. They are only rarely consulted; the National Bus Company seems to have heard of industrial democracy only recently. The quality of its management does not inspire confidence and it cannot be absolved from all responsibility for the unhappy situation which has developed in an area with an unemployment rate of 13 per cent.
A number of the bus routes involved are in rural areas which are already suffering more than their share of trouble because of the lack of public transport. We have heard about the problems of commuters, and I concede that they are serious, but there is another hard-hit group to whom no reference has been made. Within half a mile of my home there are hundreds of people who rely on their cars. Most are low-wage earners—often manual workers—and the only way in which they can get to work is by car. We know how expensive that can be together with maintenance and petrol costs. These people suffer perhaps more than any others although we must also remember that in such areas pensioners are becoming housebound because they cannot get around. They do not have cars and the absence of public transport prevents them from getting to nearby towns. This is a key factor among the causes of rural depopulation.
Industrialists in Wales have told us time and again that the failure of the transport system is the most serious problem in trying to develop industry in the Principality. Motorways are not our greatest need, but England has 1,045 miles of motorway compared with the 27 miles in Wales. Dual carriageways as major highways are more important for us than motorways. I fought a General Election in 1945 against a Labour candidate and the Labour leaflet said that if a Labour Government were elected it would build a major central highway through


Wales from North to South to unite the country. We are still waiting for it.

Mr. Donald Anderson: Surely the hon. Gentleman will agree that the biggest priority of industrialists and others in Wales is the East-West road and the development of the M4. Why does he not give the Government credit for preserving the priority of the M4 and for introducing the high-speed train to Wales?

Mr. Evans: I was going to mention the M4 and I am glad to pay tribute to the great improvement in the train service to Cardiff. The use of new technical equipment and knowledge has been impressive.

Mr. Dafydd Wigley: Does my hon. Friend not agree that while there have been beneficial developments with the M4 and the rail link to Cardiff, road developments in North Wales have been sacrified in order to pay for them and the rail service to Holyhead is being run down?

Mr. Evans: It is mainly industrialists from such areas who have spoken to us about defects in the transport system. I asked in the House in the late 1960s about the cost of a dual carriageway from Cardiff to Caernarvon via Wrexham and was given an estimate of £110 million. That would not have been too much to invest. It would have helped in the attraction and development of industry throughout Wales. Industry follows roads rather than roads following industry. As it is we have this road only as far as Abercynon, and I am told that it will not not go to Merthyr Tydfil until 1986. That is not good enough. Quicker progress should be made on the road.
In summer, conditions on many of the roads in the West and South-West are chaotic, and many hon. Members have suffered because of that. We need a dual carriageway through St. Clears and Carmarthen with a slipway from the East into St. Clears.
We also suffer from the tragedy caused during the building of the Cleddau Bridge. The people of parts of Dyfed who had no responsibility for the decision to build that bridge, must now pay more than £1 million a year in interest, a burden which the Government have refused to share. It is a scandal and dis-

grace that the Government will not accept any responsibility.
Discrimination against Wales is also to be seen in air travel. The Government have contributed £22 million towards airport development in England and Scotland but not a penny has been given for Welsh airport development. The CardiffRhoose airport should be developed as a national Welsh airport, but we shall probably have to await a Welsh Government for that.
I have often drawn attention to the continuing anxiety felt by the railway unions about the future of the lines West and North of Swansea. A group of NUR men came to see me yesterday about the ending of cheap day return tickets on early morning trains. This will slash the traffic from Swansea to London. A day return ticket used to cost £12·50, but now the cheapest ticket costs £18·90. There are now no cheap day returns on early trains, which allowed people to have a day out in London.
The residents of Fishguard believe that there is also a policy of running down the traffic between Fishguard and Ireland. They have reason for fearing that, because they know that such decisions are not made in Wales or in the interests of Wales, but are made in London. That is one of the reasons why we should have decentralisation of decision-making. Transport autonomy and Welsh control of the railways would provide the enthusiasm and knowledge that is necessary for expansion and development. In the early 1960s, South Wales railways were the most prosperous in the United Kingdom. In fact, 86 per cent. of the income came from freight.

Mr. Anderson: rose—

Mr. Evans: I have already given way to the hon. Member.
I turn now to electrification. If we had the type of control for which I plead, we would not be in our present situation. In Norway 58 per cent. of the railway lines are electrified, 62 per cent. in Sweden, 27 per cent. in France, 30 per cent. in West Germany, 33 per cent. in Japan and virtually all in Switzerland. Even in Great Britain, 19 per cent., or a total of 2,150 miles, of the lines are


electrified. But in Wales not a yard is electrified.
We are told that there is to be a new electrified line between St. Pancras and Bedford at a cost of £80 million. But, although we export so much electricity from Wales, not one of our lines is electrified. That is a scandal and a disgrace.

It being Ten o'clock, the debate stood adjourned.

Ordered,
That the Motion relating to Transport Policy may be proceeded with at this day's Sitting, though opposed, until Twelve o'clock.—[Mr. Shape.]

Question again proposed.

Mr. Evans: Wherever one looks at transport in Wales, one finds, therefore, that the situation cries out for a Welsh transport authority. I very much hope that the establishment of the Welsh Assembly will lead to that kind of authority.

Several Hon. Members: rose—

Mr. Speaker: I appeal to the House for the maximum brevity. Mr. Atkins.

10.1 p.m.

Mr. Ronald Atkins: I can agree with the hon. Member for Carmarthen (Mr. Evans) in one regard. That is that the commuter lines between the Welsh Valleys and Cardiff and Barry certainly do not cater for higher income groups. There are many branch lines like that in Lancashire and no doubt in other parts of the country. I think that the comments on higher income groups using commuter lines arise from some brain washing which must have arisen in relation to those who live in London and the Home Counties. The position on commuter lines out in the provinces is very different.
The hon. Gentleman said that Wales had no control of its railways but that England had. That is not true at all. We have no control of English, Scottish or Welsh railways. I should like this House to have such control.
One of the most revealing features of the transport consultation document is that we have no transport policy at all. We plan for roads but not for public transport. It is very significant that my right hon. Friend mentioned the probability of a White Paper every year on road invest-

ment. I immediately ask for a White Paper on railways. It is absolutely essential that investment in all modes of transport is considered together, both to see the relevance of the different forms of transport and to prevent duplication between them. If transport has suffered at all, it has suffered most of all from duplication.
I am not blaming my right hon. Friend for the lack of transport policy. I think that he said that he made some remarks on this subject 20 years ago. No doubt if they had been listened to, we should have a transport policy now. However, we have not had a transport policy since the end of the British Transport Commission. Over the last decade we have had just a series of non-events—the Transport Act 1968, the Rail Policy Review of 1973, the White Paper on Urban Transport Planning, the Railways Act 1974 and the Channel Tunnel. All were non-events.
We had high hopes for a sound transport policy in 1974, when there was a change of heart, but those hopes were dashed by the financial crisis that followed. Even the Tories were well disposed to rail transport in 1974. In their election manifesto, they said—it is worth-while hon. Members listening to this because they may have forgotten it—
Continued growth of traffic has brought with it problems as well as advantages; and has, in particular, made necessary an increasing reliance on public transport. We have recently announced a massive 5-year programme for the railways, to provide a modern network with a secure future, and the opportunity to regain freight traffic from the roads.
I wish that they had those sentiments today. It would help my hon. Friends very much if the Tories were to declare those sentiments today instead of continually asking for public expenditure cuts.
It is true that we were still in an oil crisis in early 1974 and that the Tory Government had created a large supply of money in the easiest way—by printing it. However, it is sad that the euphoria surrounding public transport was quickly dissipated in the storms of financial crisis which followed. This is the story often repeated since the war. Every plan to regenerate public transport, especially the railways, is destroyed by financial crisis, whereas what is needed is a long-term plan allowed to reach fruition. For, as our foreign competitors know well enough—they do not


hesitate to spend money on the railways —railway investment is industrial investment and is part of the infrastructure on which our industrial prosperity must rest.
The consultation document was written at a time of financial crisis and became not a formulation of transport policy hut an apology for cuts in public expenditure. An anti-rail bias appears in the document, without doubt. It is predisposed to the Socialist Commentary report of April 1975, which it describes as "authoritative"—I wonder why—and to similar views expressed by Richard Pryke again, in a book called "The Rail Problem". Like that book—it is amazing how close it is to it—this document is more concerned with immediate financial objectives and less with the 1990s and beyond, when the oil shortage will really begin to bite and the need for the existing railway network and, indeed, for its expansion, will be unchallenged.
The document statement that passenger subsidies to railways benefit the lower income groups less than the higher income groups, who travel more, was well answered by Anthony Harris in the Financial Times of 30th July 1976. He says—and this is the view of many of us with regard to freight as well as passengers—that given the long-term existence of a railway system—and we must accept its long-term existence—there is a case for subsidising it—that from the Financial Times, let it be noted.
Where such an industry is operating with declining marginal costs, that is where the cost of carrying an extra passenger—and I should like to add "or ton of freight", because the same consideration applies—falls as traffic increases, a subsidy will give a greater benefit to the traveller than its cost to the taxpayer. Moreover, I may add, the lower paid who cannot afford a car would in many cases be isolated without a rail service on which they now have the advantage of concessionary fares. The progress which the railways have made on economy fares especially caters for the kind of passenger who, as I say, would in many cases be isolated without the railways.
There are many examples of the higher paid groups getting more benefit from public services than do lower paid groups

—that is a way of life—but that would be no reason for reducing public expenditure on, for instance, higher education from which the higher income groups benefit the most, or the letter service which they use more because they are more literate and write more letters, or the health services. The higher income groups benefit from many of the services because they are intelligent enough and well educated enough to use them.
I now turn to the details in the document. Chapter 1, paragraph 9 and Chapter 3, paragraph 9 refer to the EEC. Chapter 3, paragraph 9 needs to be revised, because the Secretary of State has moved towards harmonisation on lorry size but not on tachographs and lorry taxation, and especially wages and hours. I wonder why there is no harmonisation on those matters. It seems to me that the road lobby has won its way in one regard but in other regards harmonisation has been ignored.
I now come to Chapter 2, paragraph 13. I do not believe in an open-ended subsidy to public transport, but the Government's financial support is very modest when compared with that given by countries such as Germany, Japan, France, and most continental countries. For instance, the Japanese and German Governments each pay £2,500 million a year to their national railways. These countries are high fliers. They are not inefficient. They realise the value of their railways, and how valuable the railways are in economic recuperation. We could well follow their example in this regard.
Nor, when they pay up to £2,500 million every year, do they say that the money must go to passengers and not to freight. Why should the money not also go to freight? Is the environment destroyed any less by lorries than by buses? The environmental disadvantages of heavy road traffic, both in towns and in the country, are very great, as are the social disadvantages of heavy lorries going through villages, destroying their peace and quiet, and also destroying their water and gas mains. No doubt, this is one of the reasons for the recent mysterious explosions—heavy traffic on urban roadways which were not built for heavy traffic, and lorries of ever-increasing size and weight.
The subsidy should be used to run the railways to capacity, and to integrate the different modes of transport, eventually reducing the need for a subsidy, as we have been in the United States.
Paragraph 22 of Chapter 2 of the consultation document is a good example of have seen in the United States.
While traffic on motorways has quadrupled since 1964, goods vehicle traffic on urban roads has been falling.
I discovered from the Department that the criterion for this happy conclusion was based on the number of lorries on urban roads but not their weight and size, whereas, elsewhere on other roads, it was based on weight and not numbers. As the document says in Chapter 2, paragraph 22, the sharp increase in goods carried by road has been catered for by increases in the size of lorries, not in their number. The Department admits it.
Conditions on urban roads are much worse because of the heavier lorries damaging roads more severely, since wear and tear is related directly to the weight on the axle to the fourth power. At least one of the recent gas explosions was the result of a fractured gas main caused by a heavy lorry, and there must be much more of this and other damage in our towns.
Turning to Chapter 2, paragraphs 24 and 25, I point out that the 300 million tons of freight now carried by road on distances of over 100 kilometres is the kind of traffic that Beeching envisaged as most suitable for carriage by rail. If even a relatively small proportion of this was transported by rail, it would have very beneficial revenue implications for British Rail, and would make a consider-

able contribution towards its financial viability. The National Freight Corporation is carrying only 10 per cent. of the traffic envisaged by Beeching—3 million tons instead of the projected 30 million tons.
After putting a strong case in Chapter 3, paragraph 5, for public transport, the document goes back to twisting the facts again in paragraphs 12 and 13. Paragraph 3.12 states:
Even if all freight movement of more than 100 miles were transferred to rail, total road traffic would be reduced by only 2 to 4 per cent.
This is misleading because it fails to compare like with like. Total road traffic as mentioned in the document refers to all vehicles, including milk floats, passenger vehicles, cars, and, no doubt, even bicycles as well. It is true that if 11,000 million ton/kilometres were transferred from road to rail the decrease in road traffic would be only 2 per cent., but such a transfer would reduce road freight traffic by 12 per cent., or, if the transfer were in the over-100 mile range the reduction in road freight traffic travelling over 100 miles would be 28 per cent.
We do not suggest that this volume of traffic could be transferred to rail, but we believe, as did Beeching, that considerable amounts could be transferred, with benefits to the environment and dramatic improvement in railway finances.
Paragraph 3.13 states:
Gains from getting some lorries off interurban roads might be offset by losses in sensitive urban areas—that is to say, in unloading a 700-ton freight train in an urban rail goods depot by 80 medium-sized lorries. The document overlooks the fact that the number of lighter lorries is far less important.

Mr. Forman: Should not the hon. Gentleman declare his source, when he appears to be quoting so extensively from a published document?

Mr. Atkins: I wrote it myself as Chairman of the Transport Group of the PLP. My last quotation came from the Transport Consultative Document. I trust that the hon. Gentleman has read it. That document says:
The document overlooks the fact that the number of lighter lorries is far less important than the urban mileage of juggernaut lorries delivering from door to door, and causing maximum damage to roads, (and buildings, water, gas mains, etc.), on the basis of the weight on the axle to the 4th power ratio. The GLC has just recently shown an awareness of this problem by designating a number of peripheral jugggernaut unloading points for goods redistribution by lighter vehicles. But greater urban road mileages will be covered this way, than by unloading freight trains that relatively quietly reach inner city depots for redistribution by lighter lorries, on the principle that distances travelled from the centre of the circle are generally shorter in total than distances travelled across the circle from outside.
I shall now refer to paragraph 3.21. We are debating this document and we are right to keep to it. We have heard many other things, but little about the document. That paragraph is concerned with energy conservation. I believe that the Government's present transport policies do not, in practice, meet the requirements of energy conservation in two ways. First, the percentage of track electrification, has remained low. Secondly, a great deal of transport-related taxation is on the motor car. This is therefore the same, regardless of the size of the vehicle, or the annual mileage it travels. If the taxation were entirely on petrol, the revenue raised would more nearly be in proportion to the use made of the roads, by vehicles. Studies have indicated that this system, if introduced on a no-net-loss-to-the-Treasury basis, would benefit the motorist who drove less than 8,000 miles per annum.

Hon. Members: Hear, hear.

Mr. Speaker: Order. I hope that the hon. Gentleman will not be encouraged by those who are cheering him. I think that they have given up hope of being called.

Mr. Atkins: The discouragement I have received from you, Mr. Speaker, far

outweighs any encouragement from Back Benchers.
My right hon. Friend spoke about our objectives and I shall finish on that note.
I conclude by begging the Government to abandon the attitude that to carry less and less at higher and higher prices will be good business for British Rail. Every reputable railway economist—I leave out one who might think himself reputable—knows how much lower would be the resource costs of using rail transport for additional ton miles and passenger miles compared with road alternatives.
This is by far the best way to increase productivity. We should not be reducing staff but using the railways to capacity. Road haulage would not be hurt, as the document states and as the hauliers tell us, because it is an expanding industry that will continue to expand. In this way the railways would become viable. We would get rid of the present problems and the most unpleasant traffic would disappear from our country areas and cities.

10.21 p.m.

Mrs. Elaine Kellett-Bowman: Thank you for squeezing me in, Mr. Speaker—[HON. MEMBERS: "Hear, hear."] When listening to the Secretary of State's reasoned and pleasant introduction to the debate, I could not help thinking that the tone of the document would have been very different if it so happened that he had written it. Although there is some useful information in it, much of which has been referred to us in detail, and some helpful suggestions, I feel that the whole of the document is very much anti-rail. That is a feeling that is shared by some others. To my mind it is downright snooty in parts.
Surely it was quite unnecessary to bring in what was no less than a nasty bit of class warfare in page 20 of the first volume, which states:
the predominant users of subsidised rail services are members of better-off households".
So what? If they use the rail services and thereby make them more economic, the rest of the people will benefit. In fact, the assertion to which I have just referred is not true, as my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) proved quite conclusively in his


opening remarks. I am glad that he took up the point.
The Minister made the level-headed observation that the vast majority of households use both public and private systems of transport and, therefore, benefit equally. But that is not what is said in the document. This is what makes the document appear to be anti-rail. In page 36 it is stated:
it may be sensible … to substitute good bus services for heavily subsidised rail services.
By the way in which it is phrased it manages to convey the impression that railways are rather fuddy-duddy and that the national bus services are get-up-and-go organisations that whisk us straight to our homes. Unfortunately it does not work out like that in practice.
When my area's stretch of the main Glasgow-London line was electrified—and I am glad that it was—I used to dread travelling on Sundays because part of the journey had to be done by bus. It was most inconvenient. If some of the proposals in page 51 are implemented, and what are described as "other provincial services" comprising local and stopping passenger services are axed, which carry 6 per cent. of rail passenger mileage, we shall get a Sunday service every day of the week. That will be a serious blow to many extremely lovely areas not only in my part of the world but throughout the rural areas of the country. It will be a particular blow to my area, which is just blooming out as a category "A" tourist centre.
In my part of the world we have the finest railway museum in the country at Carnforth. If the small lines are closed we shall not be able to get to many such places. As I understand it, all the local services in my area are at risk. Many of them pass through countryside so lovely that they are worth using on that score alone—for example, Keighley to Morecambe via Skipton, Leeds to Morecambe via Skipton and, best of all, LancasterOxenholme-Kendal-Windermere, a line that is known to many millions of holidaymakers. If we axe that latter line, we shall add to congestion on roads in the Lake District when the amount of traffic on them urgently needs reducing, not increasing.
Many hon. Members in the Second Reading debate emphasised the need to be able to identify routes that are uneconomic. The Minister said that next week he will be addressing the EEC Transport Committee. He will find that for many years that committee has been struggling for greater transparency in transport costing—in other words, for attaching costs openly and accurately to different parts of an undertaking and allowing the subsidy required for social purposes to be openly and fairly given. There is nothing to stop the subsidy from being given but it must be identifiable as such.
The urgent question of rural transport was discussed at length by my hon. Friend the Member for Morecambe and Lonsdale (Mr. Hall-Davis) and myself with the Minister's predecessor. As has been said, Ministers disappear so fast that it seems that as soon as we discuss something with one of them he is going out the back door. Many of the points we discussed are on page 48. They are reasonable points. I am convinced that most of them were already in the emergency powers introduced by my right hon. Friend the Member for Yeovil (Mr. Peyton). Unfortunately, they were cut out of the Socialist Government's Transport Act which followed. We are completely hamstrung by the present licensing structure administered by the traffic commissioners, although the document inquires politely.
How much, if at all,
—I emphasise "if at all",—
should licensing regulations be relaxed".
This ties up all too ominously with the reference to
modest relaxations of the bus licensing system",
on page 36.
The whole system needs radical recasting or abolishing, since it rarely manages to keep services in being and prevents other forms of self-help and independent transport from springing up in their place. I was glad that the Minister said that he had an open mind on the matter. I hope that he will have not only an open mind but the courage to act decisively to break the present bureaucratic monopoly, which does nobody any good, except those few dogs in the manger who stand in everybody else's way while themselves providing poor, if not minimal, services.
Lastly, but by no means least important for a vast number of households, there is the vexed question of school transport, which comes under the Secretary of State for Education and Science. I believe that in any reorganisation it should come under the transport Department, which is the obvious place. My right hon. Friend the next Prime Minister brought out a consultative document in 1973, and the present Government brought out a revised consultative document in August 1975, but still nothing has been done.
The present system causes appalling hardship in most rural areas, and particularly in my part of the country. In my own village it costs £2·80 a week to send a child over the age of 15 to school by Ribble Bus. When the clerk to our Halton Parish Council raised the matter with me in October 1975, the cost was 18p a day for each child. The bus company had then just raised the child's fare from a half to two-thirds of the adult rate. Even then there was—to quote the clerk, and to my own certain knowledge—"considerable hardship". Today, with fares no less than 10p a day higher, and little if any overtime to be had, the hardship is very much greater. One family in my village is paying £1·20 a day for three children, a total of £6 a week. That is a dreadful hardship in a relatively low-wage area. Another family with two boys, aged 15 and 13, is paying £4·60 a week. There are similar examples throughout the constituency.

Mr. Leslie Spriggs (St. Helens): rose—

Mrs. Kellett-Bowman: May I continue?
When the House considers, moreover, that the unemployment rate in my constituency is estimated to be 8·4 per cent., and that there is no provision for rebating fares for children whose parents are unemployed, it is obvious that the hardship is very serious.
More flexibility of transport and greater sensitivity to local needs could, even in times of austerity such as these, do a great deal to raise the standard of wellbeing of millions of people, especially in rural areas. I very much hope that the Minister will assist in seeing that this is brought about and that nothing is allowed to stand in its way.

Several Hon. Members: rose—

Mr. Deputy Speaker (Sir Myer Galpern): May I reinforce Mr. Speaker's appeal for short speeches? Fifteen hon. Members still wish to take part in the debate, and they have all been waiting patiently. There is roughly an hour before the winding-up speeches begin. I suggest, based on the practical experience of occupants of the Chair, that five minutes could allow an hon. Member to make all the salient points that he wishes to make. To confine a speech to that time would show a nice New Year spirit of co-operation and would allow nearly every hon. Member who wishes to do so to take part in the debate.

10.29 p.m.

Mr. John Evans: I have no sectional interest in this debate, either from a trade union point of view or from the point of view of any particular lobby.
I shall not advance constituency interests, although I could well do so, as I have two of Britain's great motorways, the M6 and the M62, running through my constituency, with a huge, 100-acre interchange at the heart of my constituency. The southern boundary of my constituency has one of Britain's great waterways—the Manchester Ship Canal. The first man to die on a railway line died in my constituency. When one considers the issue of the second runway at Ringway Airport, or the Manchester versus Liverpool argument, one realises that a great mistake was made in the 1950s when the old Burtonwood airbase was not chosen for use as an airport for the North-West.
But I do not want to follow up any of those points tonight. I want to concentrate on the essential importance of having an efficient transport system, and obviously that means an efficient railway system and an efficient motorway network. It is right that we should take account of the social and environmental cost of providing these systems. It is essential that, as far as possible, subsidies should not be applied to the carriage of freight. But I am mystified that when we consider subsidies on the carriage of freight we should identify the subsidy of British Rail but we do not even try to identify the subsidy on road transport.
Everyone who comes to Newton-le-Willows in my constituency is amazed by


the number of signs, at virtually every road and avenue in the town prohibiting heavy lorries from parking in the street. Newton-le-Willows is situated about halfway between London and Glasgow on the M6, and it is an ideal stopping off point for lorry drivers. These heavy vehicles were smashing up the roads, footpaths and drainage systems, and the tremendous social cost was borne by the Lancashire County Council and the Newton-le-Willows urban district.
If we consider the various costs of road and rail, we must ensure that these add up to the true amount. A railway-man asked me last Friday evening why British Rail must bear the cost of maintaining tracks, signalling, policing and financing. He wondered why such costs were not borne by the road haulage industry as well, instead of by the taxpayer. In fact, if we added up the costs properly, we might be surprised.
We must ask ourselves whether the present local government structure ensures that local democracy can play its full part. The Newton division, because of the disaster of local government reorganisation, is split between three county councils—Cheshire, Merseyside and Manchester—and the three carry out entirely different transport policies. For example, when I tried to get them all to agree on concessionary fares for elderly passengers, I could not, and as a result we have three different authorities administering different passenger transport systems. I suggest to the Secretary of State that a regional Assembly for England is the only sensible body which could handle transport affairs.
I accept that the argument of road versus rail is steriie. But I think that there should be a word of caution sounded about talking of a common or integrated transport policy. This is something one hears of regularly in the European Parliament and its committees. Sometimes people feel that because they have passed a resolution or made a statement, a common transport policy will result. In fact, it makes it even more difficult because there are so many conflicting points of view about what constitutes a common transport policy.
The Secretary of State made it clear in his opening remarks that he had

accepted my invitation to attend a meeting of the Transport Committee on Monday. I think he will find that he is putting his head in a noose, or certainly entering a hornets' nest. He will find a great deal of concern, argument, and debate about the lack of action on the part of Community transport Ministers in implementing a common transport policy. A great deal of that criticism is levelled at Britain.
Some hon. Members will appreciate that Britain should be obeying Transport Regulation No. 543/69 which would mean very substantial changes in the costing of road transport. The Minister has applied for another derogation. I believe that this is the fourth derogation for which we have applied since we joined the EEC, and it will be the last we can get. Unless the new proposal, which was debated in the European Parliament in December, is adopted, the regulation of 1969 comes into effect. That will mean substantial changes in costing for the road haulage industry.
I am sure that my right hon. Friend the Secretary of State appreciates some of the things that the British Members of the European Parliament did there in December in getting a new clause for the document adopted. If the Council of Ministers adopt it, it will give Britain a further three years in which to bring our policy into line with that of the rest of the EEC. This is a criticism of the consultative document. I realise that my right hon. Friend and his hon. Friend had no part in writing the document, and I challenge the entire basis of it because the costings upon which it is based took no account of EEC policies.
My hon. Friend the Member for Preston, North (Mr. Atkins) said earlier that little progress had been made on harmonisation of road transport, but he is wrong. This year all these policies will have to be harmonised. The argument about the tachograph is a little confused, to say the least. There is a "Catch 22" situation in the new regulation. It states that if a vehicle does not have a tachograph it will be limited to journeys of 450 kilometres, or 280 miles. If that were implemented it would require two drivers per vehicle for many journeys in Britain. That would have considerable consequences for the cost of living and for the road haulage industry.
The other aspect with which, as I appreciate, my right hon. Friend is wrestling is that of axle loads. If we are forced to adopt the heavier lorries on which the Continentals are insisting, substantial costs will be incurred in strengthening our motorway network and particularly in strengthening the bridges. Many of our bridges just could not bear the weight of heavier lorries. Many hon. Members supported our joining the Common Market. This is one area where we joined the club after the policy had been established and we shall have to accept the consequences.
Will my right hon. Friend attempt to quantify the costs involved in the implementation of Regulation 17/76? Will he comment further on the cost to the United Kingdom of allowing the heavier lorries on to our roads?
My right hon. Friend and his colleagues will have to take up the question of the tachograph with the Transport and General Workers Union. I believe that lorry drivers in this country have started from the wrong premise and that we have but a short period of time in which to persuade them to accept the tachograph. It does not matter how many Bills this House may pass or how much legislation may be passed by the European Parliament. If the lorry drivers in this country say that they will not work with the tachograph, they will not work with it.
I believe that in the long term it will be in their interests to accept it, but at present they will not. We therefore must persuade them. If we do not succeed, long journeys will be limited to 450 kilometres and we shall face substantial increases in costs. For that reason I urge my right hon. Friend to re-examine the document, ignoring past costings but bearing in mind future EEC legislation that Britain will have to accept sooner or later.
If my right hon. Friend considers the cost to Britain of joining the EEC and relates that to future transport costs I believe that the costing of the rail network will be greatly altered. One railwayman in Newton said to me recently "Remind your colleagues not to forget that once a railway line is removed, there is little chance of its being replaced".
I submit that the rail as well as the motorway network is absolutely essential

if the United Kingdom is to remain a fully modernised industrial country.

10.41 p.m.

Mr. Hal Miller: I hope that the hon. Member for Newton (Mr. Evans) will forgive me if I do not take up valuable time, in deference to your advice, Mr. Deputy Speaker, in supporting his plea for a national policy on concessionary fares for old-age pensioners and, as my hon. Friend the Member for Lancaster (Mrs. Kellett-Bowman) reminded us, scholars.
The Secretary of State showed a refreshing openness of mind which has not been displayed by some hon. Members who professed their totally objective approach to road and rail policy. Therefore, I wish to place the subject in context.
I assure the hon. Member for Preston, North (Mr. Atkins) that in the Council of Europe I proposed the motion that led to the passage of a resolution on the Channel Tunnel. I hope that the hon. Gentleman will be equally objective in admitting that the M6 has relieved a great deal of intolerable congestion in Preston.
What I wish to say about the industrial context of this debate rests on a sentence in the Secretary of State's speech. The right hon. Gentleman said that road building is a vital part of total industrial investment; it is not simply the icing on the cake.
Those who have been propounding the case for the railways, particularly employment on the railways, would do well to reflect that the number employed in the road haulage industry is about the same as on the railways and that the self-employed in the road haulage industry number twice as many. For instance, there are 900,000 holders of heavy goods vehicle licences. Therefore, employment in both areas of transport must be borne in mind.
I wish to draw attention to the industrial consequences of transport policy. Some of the measures which have been advocated, including tax on petrol and the abolition of the vehicle registration fee, would have serious industrial consequences leading to the need to produce totally new designs of motor car engines.

Mr. Ronald Atkins: Is the hon. Gentleman aware that that is the usual system of taxation in practically every other country in the world and that those countries do well out of it?

Mr. Miller: The point is that it would have a considerable effect on the design and manufacture of motor car engines in this country. I believe that was why the Secretary of State for Industry prevailed in the argument with the Secretary of State for the Environment on that point. Serious industrial consequences often flow from decisions on matters affecting transport.
What manufacturing industry as a whole—I am not referring to the motor car industry—finds hard to understand about the roads programme, when considering it as part of the production line, as it undoubtedly is for many motor car manufacturers, is that our national priorities seem to have gone sadly astray. For example, the Midlands are connected to the holiday areas of Devon and Cornwall but not to the East and South Coast ports.
There is a demand for national priorities on motorways to be reassessed and to be seen to be reassessed. Doubt about national priorities having been got right not only as between road and rail but inside the road building programme has led to a great deal of dissatisfaction at public inquiries and to a lack of confidence by members of the public in the programme, about which some hon. Members have already spoken.
I want to take up a point about the Secretary of State's suggestion of holding an annual debate on an annual White Paper. I am not entirely satisfied that it would be possible—bearing in mind the debate that we have had tonight—to give consideration to national transport policies in that way. I would like the Minister to consider whether it might not be preferable to set up a Select Committee—or some other form of scrutiny—to send for evidence and witnesses, and to examine how a scheme of priorities should be drawn up.
I want to mention procedure. It is quite incredible that it should take 15 years to build a motorway. The waste of time and effort is incalculable. The motorway network should be decided

nationally in Parliament and local inquiries should deal with the matters of line. There is an intolerable position over the building of the M23 at Winchester. It has led to a total lack of confidence in the inquiry system, quite apart from recherché points about appeals and methods of computation of benefits. In that connection I welcome the appointment of the Leitch Committee to inquire into analysis and other figuring of investment value.
The Secretary of State should understand that the whole motorway programme has been brought into disrepute by the failure to establish priorities and to provide a sensible procedure for local inquiries, and by the manner in which inquiries have now been laid open so that the whole programme can be considered afresh in public. This is no way in which to provide a transport policy.
I ask those hon. Members who have spoken so strongly in favour of the rail lobby and of attracting people to public transport to consider who the people are that they want to attract. The present Secretary of State for the Environment has said that cars, television and the social wage have transformed the lives of millions of working people. It is those working people who do not have cars that some hon. Members would seek to deprive of the opportunity to acquire them. These working people do not want cars just for driving around, but to get to work, to enable them to find a house in an area in which they would like to live, and to enrich their lives.
A shop steward wrote to tell me that because he now has a car he can go further afield in the search for work, that he can live and bring up his family in an area far removed from the noise and grime of work, and that he can use his time for relaxation to its fullest advantage to pursue his personal development in a way that would not otherwise have been possible.
This trend of thinking—restricting road use by pricing people off the road—is among the worst examples of class discrimination, and it was conceived by people who are supposedly on the Government side. The question must be asked—against whom is the restriction proposed? I ask hon. Members who have spoken against motorways to understand that personal mobility has brought


a new freedom and liberation to the lives of millions of ordinary people.

10.50 p.m.

Mr. Alan Fitch: I welcome the consultative document. That does not mean that I agree with all of it, but it is a basis for consultation and I am sure that it does not represent the Government's final word on this extremely important subject.
It is a matter of regret that the document has been attacked, more from outside the House than from within, for what it is not. It is an adequate basis for this debate and for outside representations. I stress that it is a consultative document.
I am pleased that the Prime Minister has recognised the importance of transport policy and included in his Cabinet a Minister with special responsibility for transport. My right hon. Friend the Member for Stockton (Mr. Rodgers) is an excellent choice as Secretary of State. I know that he will consider everything which is said in the debate and will also examine the views of outside interests. I know of my right hon. Friend's interest in transport. I still have a copy of the pamphlet, which he mentioned earlier, which he wrote 17 years ago.
I have a non-financial interest to declare. I am joint chairman of the all-party road study group, but I hope that my right hon. Friend will not regard my remarks as special pleading. I am sure that he will not be influenced by special pleading, whatever its source. No doubt he will exercise his judgment and make up his own mind.
Most of us travel by road and rail although if rail fares continue to rise as rapidly and excessively as they have recently, this form of transport will become increasingly prohibitive to all except those with expense allowances or on high salaries.
We must strike a balance between the various forms of transport, based on the facts. As the Secretary of State said, there are many claims on our limited resources in present economic circumstances, and manufacturing industry cannot be ignored if we are to overcome our economic difficulties. In considering a Socialist transport policy, we must get our priorities right and should not be

bound by tradition or settled habits. We must not be afraid to have a fresh look at transport problems. We need an efficient road system for passenger and freight traffic, just as we need an efficient rail system for passengers and freight. We must relate our reduced resources to economic and social objectives of the highest priority.
There must also be an element of choice. For many industries, road freight is a convenience, and if we unreasonably restrict it, we shall reduce the efficiency of industry. This can adversely affect our export performance and employment. We must dispense with some of our preconceived ideas about transport and base our policy on the facts.
Transport policy can be considered on two time scales—the immediate future and the period from now to the end of the century, as envisaged in the consultative document. The facts which I shall outline are crucial to both time scales.
Transport accounts for 13 per cent. of our gross national product; it will continue to be overwhelmingly road based; transport is one of the three main items of consumer expenditure; and the cost of all consumer goods is affected by the efficiency of distribution. As 90 per cent. of all goods are transported by road, the quality of the road network plays a vital part in keeping down costs. Employment in all sections of the transport industry involves about 3 million people, of which British Rail employs less than 10 per cent. As the consultative document states:
We must bear constantly in mind the existence of all those who work in transport industries.
Every business and every person uses transport and it is therefore everybody's problem whether directly as a consumer or indirectly through the consumption of goods and services. For the long-term transport policy should incorporate a plan for roads to provide satisfactory mobility for all users—lorries, buses and cars. That requires a programme to reduce or remove existing congestion and to prepare for future growth in traffic.
The current economic crisis gives urgency to the consultative document's claim that
The prime objective of transport policy is an efficient system that provides good transport


facilities at the lowest cost in terms of resources used.
Restraint on public spending should require that expenditure in the next few years is concentrated on investment with a positive rate of return, but unfortunately investment in roads has been cut seven times in the last three years. We criticise industry for its poor investment policy, but if the Government fail to invest in a viable road transport policy, they will be guilty of the same lack of foresight for which they have rightly Blamed industry. Roads are just as much an integral part of the industrial process as an assembly line or warehouse. Scarce resources must be directed to areas that will contribute most to economic recovery. The old road versus rail argument is out-dated and should cease.
Our future transport policy must be realistic. The days of thinking up slogans have gone. We must think about the problems. I have been as guilty as anybody in talking about an integrated transport policy, but now I am beginning to ask what is meant by it. There are many concepts of what is an integrated transport policy among our trade union friends.
I turn briefly to environmental objectives. The consultative document, in out lining environmental objectives, gives a fair and balanced account of the problems. It states:
There is today, and rightly, immense public concern about the effects of the growth of transport, especially road traffic, on the environment.
It is right that we should be concerned, but it is regrettable that certain organisations have used public inquiries to break up proceedings. Some people set a bad example. My right hon. Friend the Member for Battersea, North (Mr. Jay) mentioned the M3 inquiry. I do not wish to pass judgment on that because I do not know enough about the pros and cons. An hon. Friend and I wrote a letter to The Times, and we received a number of abusive letters from educated people. Had the same uproar been created by miners or dockers at a trade union meeting we would have heard more about it. One would expect public school boys educated at Eton and Winchester to behave better.
I have truncated my speech considerably and I shall now turn to my final

point. I happen to live in a part of the world, Lancashire, which is surrounded by motorways. In my opinion, the M6, particularly the part from Preston northwards, adds to the environment. It does not detract from it. I say the same thing about the M62, which links Lancashire and Yorkshire. It is a fine piece of road engineering through the Pennines which adds to rather than detracts from the environment.
Good motorways have meant that millions of people have been able to enjoy the beauties of the Lake District and of our other beauty spots, people from various parts of the country, many miles away, because they have a route that provides easy access.
Finally, there is probably a case for the terms of reference of public inquiries to be altered. But there is no case at all for people who make it their job to disrupt what is a perfectly orderly inquiry. I know that the Minister is a man of judgment. He has in his possession a certain amount of money. Little though that amount may be, I know that, having heard this debate, he will spend it wisely and well.

11.1 p.m.

Mr. Robert Adley: I agree with the hon. Member for Wigan (Mr. Fitch) about the antics at Winchester. While they were going on, one of the local Transport and General Workers' Union officers rightly said to me that if his members had behaved like that in sitting-in at a factory, it would have been the people in the Winchester area, with their nice houses and smart addresses, who would be the first group to write letters to The Times deploring such appalling behaviour. It is surely an indication of the weakness of the argument when the behaviour has to degenerate to that level.
I start by congratulating both the Secretary of State and my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) on the way in which they have sought to conduct the debate. I hope that it is not presumptuous of me to say that their speeches were extremely impressive.
Like most other hon. Members, I have been bombarded with paper on this subject. I decided to open my speech with the remark "Never has so much paper


been sent to so many Members of Parliament containing so little that is new." I shall try to respond to the Secretary of State's invitation to be constructive.
I agree with the Secretary of State that the road versus rail argument is totally sterile. For example, one will never get domestic deliveries of milk by rail! One could cite numerous similar examples.
There are so many matters that should be mentioned. In order to be brief, I apologise for concentrating on a few items and speaking rather quickly.
I also agree with the Secretary of State and other speakers that on the whole British Rail does an extremely good job often in very difficult conditions. I do not know how many other hon. Members sent a telegram, as I did, to the Chairman of British Rail congratulating him on the way in which services last week were kept going in really foul weather, particularly on the Southern Region with its third rail. A great deal of effort was put in throughout the night, on several nights, by hard-working people who received precious little thanks from the general public.
We have a valuable rail network. We must preserve it and improve it. I believe, nevertheless, that there is truth in the argument that the subsidy currently being paid to British Rail for the maintenance of the services is a subsidy wholly at the taxpayers' expense and that, although it is paid for by all taxpayers it is really for the benefit of a comparatively small number of people and, on the whole, people who are better off. To say that people in South Wales cannot be classified as better off is no longer correct. I suspect that many people in South Wales who have jobs have a great deal more money in their pockets than very many of my constituents who are living on fixed incomes, for whom a rail journey is but a memory of the past.
One thing that British Rail could improve—and improve considerably—is its marketing techniques. In view of the relationship that British Rail have established with the trade unions, it should be possible for them to provide off-peak services at attractive rates by using train crews who provide the peak hour services. Their hours of work should be allocated more intelligently than they are at present, and marketing should be the cata-

lyst to create new off-peak low-rate services.
Next, I come to the question of concessionary bus fares. The Under-Secretary of State will recall that recently Mr. Deputy Speaker and I went to see him to argue the need for the National Bus Company to operate a scheme of concessionary fares, particularly for pensioners, in off-peak hours. The present arrangements, whereby the ratepayer is asked to fund concessionary fare schemes —and that means for the benefit of the bus companies, and mainly for the benefit of the NBC—are wholly unfair and unsatisfactory. I cannot think of any other sphere where a local authority is required to pay out of the rates for the provision of services to people merely because they have become old. This is normally considered to be a function of central Government if it is to be a subsidy.
I believe that the National Bus Company could easily produce a national scheme of concessionary fares. British Rail have done it with their £6 card. If this payment of £6 can get someone a 50 per cent. discount for off-peak rail services almost anywhere in the United Kingdom, surely the NBC should be willing and able to introduce a similar scheme for use on its off-peak services, particularly by pensioners? I again plead with the Minister and the Secretary of State to take this matter up with the NBC and insist that in return for the virtual monopoly that it enjoys over wide tracts of Britain it should accept some obligation to provide concessionary fares. A card for sale would not involve any extra public expenditure.
The NBC has an extraordinarily elaborate scheme of concessionary fares for its staff and retired staff. One could quote scheme after scheme of staff concessionary fares, such as that which the National Freight Corporation inherited when it took over National Carriers Limited. It had to cope with the need to provide concessionary fare schemes for 26,000 people, which is now costing £1·2 m. annually.
My constituents live in two local authority areas, in two counties, and with two separate bus companies serving them. They cannot understand why different schemes of concessionary fares apply in


those local authority areas and within the workings of the two bus companies. It is wholly unsatisfactory.
The question of the traffic commissioners has been dealt with fully. I reinforce the point made by my hon. Friend the Member for Sutton Coldfield. He mentioned the 1930 Traffic Act, which was introduced following the 1928 Royal Commission. Even though that Act was passed all those years ago it still forms the basis for the activities of the traffic commissioners. I ask the Secretary of State to reconsider his rather disappointing remark when I intervened in his opening speech that at the moment he is not persuaded of the need to reconsider the role of the traffic commissioners.
I believe that the proposals in the consultative document about local authorities being brought more into the consideration of licensing arrangements have a great deal to say for them. It is an unfortunate fact that so many of the bus company areas are not contiguous with county boundaries. This enables the NBC to play off one county council against another, or one district council against another. I plead with the Government to reconsider their views about the traffic commissioners. As many hon. Members have said, their activities are contrary to the public interest.
I believe, too, that the wish of many Labour Members to reduce competition is contrary to the public interest. I cannot accept that the public are best served by a single transport monopoly. One could quote case after case. British Airways and British Caledonian both provide services to Scotland. Most people accept that alternative services and consumer choice have meant that both airlines in competition are providing a first-class service, just as British Rail is doing Good competing public transport services keep prices down, increase business and create jobs.
It is interesting to realise that the only part of British Rail that operates at a profit is its Hotels Division. It is the one part of the organisation that is totally open to competition. Perhaps I should declare an interest even in mentioning hotels. I hope, however, that the Minister will take note of the criticisms of British Rail catering by the Central

Transport Consultative Committee. I have a great deal of sympathy with its suggestion that the catering service of British Rail should be let out to tender. It may have the result of giving the rail traveller a better service, and saving the taxpayers some money.
Let me say a few brief words about British Rail's attitude to railway enthusiasts. As a member of the Railway Correspondence and Travel Society, may I ask the Minister to ask Mr. Parker to treat with sympathy organisations such as the East Somerset railway?
I wish to make a plea for trams—the very mention of which usually causes giggles in the House. We must remember that many Continental cities—Munich, Zurich, Brussels—still have tram services. We are unlucky that it was thought fit suddenly to do away with trams in our major cities. We have done away with the trams, but we have finished up with bus lanes—which are an admission that trams are a good thing!
We must remember that transport can be a pollutant and that it can and does raise environmental issues; but it is worth noting the comments of Professor Peter Hall in the New Statesman last week. He said:
Environmental fantasies are too expensive for a nearly bankrupt nation.
Stress should be laid on the word "fantasies", but if we are not careful we are in danger of losing sight of the wood for the trees. I hope that we shall learn from what happened in the anti-Concorde campaign, when people with wholly different motives used an environmental argument for their own ends.
I wish to deal briefly with the question of the Winchester bypass. It was designed originally with dual 20 ft. wide carriageways, which by the design standards of the time, were provided for traffic flows between 4,000 and 9,000 vehicles per day. However, the average 16-hour day flow on that bypass in June 1976 amounted to 35,000 vehicles. I submit that nobody in his right mind could argue that there is no need for a new link between the M3 and M27.
If anybody should think that we have far more motorways per head of population than annbody else in Europe, I must inform the House that on that score in Europe we are almost at the bottom of


the league. The House might like to know, as a matter of interest, that the number of kilometres of motorway per million head of population in Holland is 105, in Belgium 103, in Germany and Italy 93, in Luxembourg 71, in Denmark 68, in France 64—and in poor old Britain which is bottom of the table, only 34 kilometres of motorway per million head of population.
The Minister has asked for constructive suggestions. Let us try to improve British Rail's marketing; make the National Bus Company introduce concessionary fares for the old; let the present role of the traffic commissioners be abolished, their powers redefined and transferred to local authorities; let the British Rail catering services be put out to tender. There should also be a general direction to British Rail to help light railways.
Experiments should be carried out in the use of tram cars. My final plea relates to the Channel Tunnel. The Minister said that we should seek to take advantage of British presidency of the European Commission. I suggest that there is no better way of helping British Rail into Europe than by resuscitating the Channel Tunnel project.

11.14 p.m.

Mr. Gordon A. T. Bagier: I am tempted to take up many of the points made by the hon. Member for Christchurch and Lymington (Mr. Adley), but, in the interests of time, I shall dwell on only two or three. The hon. Gentleman mentioned the possibility of hiving off the catering services of British Rail. No doubt, with his general approach to politics, he sees the chance of some profitable plums there. Almost in the same breath, the hon. Gentleman said that British Rail hotels were profitable, and I know that he and many of his hon. Friends would like to take a profitable section away from the public sector.
The hon. Gentleman's general approach to politics seemed to creep into his attitude to old-age pensioners and travel concessions, too. I assure him that I do not know of any Labour-controlled authority with responsibility for these matters which has not found the money to provide such facilities, in spite of being hard pressed. The hon. Gentleman, who represents an area vastly different from

the one which I represent, seems to have difficulty with his local authorities passing the hat round to his constituents, via the rates, in order to provide what I regard as a service of great human value.
I hope that I shall be forgiven for raising now a matter which affects my area, since it will illustrate what could be a general aproach to transport. I refer to the exciting Metro project going ahead in the Tyne and Wear area. When completed, it will be part of a system which, I hope, will serve as an example of an integrated transport system. We shall have a system whereby the bus services, the local PTA services, the rail services, the old South and North Tyneside electric system and the Sunderland-Newcastle system will all come under the one heading, under the passenger transport executive of the Tyne-Wear authority. There will be interchangeability of services, with bus services meeting train services and fare structures generally designed to meet all requirements.
I look forward to the new system as an exciting new project in transport economics. It has been planned round the centre of Newcastle, and it will be connected with all the five metropolitan districts which comprise the area, bringing into being what I hope will be a fully integrated transport system.
I ask my right hon. and hon. Friends in the Department to recognise the value of this system. We could do well to learn some lessons about integration, or what we think we know about integration. It would be mealy-mouthed to suggest that there are not grave difficulties. We have had our share of them from the outset of the Tyne and Wear Metropolitan scheme. We had the problem of inter-union dispute about who should do what and who should drive what, and that problem is still not entirely settled between the T & GWU, the three rail unions and the management. People have had to get together to thrash things out and move away from decisions which they originally took. There have been problems between road and rail, problems of ownership, of management and of structure.
If such difficulties can arise in a comparatively small area such as the Tyne and Wear passenger transport executive district, we should be foolish if we did not learn some lessons and urge the


national officers of our various organisations and the transport executives to think now in terms of how they should approach an integrated transport system, however that concept is interpreted when the time comes. It is no good waiting till the last minute and then saying that there are problems.
If it is accepted that there is wasteful transport at present, with similar systems running alongside each other, the implication is that, if there is to be an integrated transport system, something will have to make way for something else, and there may well have to be some fairly close discussions between the various interests involved. I hope, therefore, that Ministers will quickly put in train some close talking with all the various interested parties.
I turn now to the question of our railways. I do not believe that there is necessarily a great face-to-face argument between road and rail interests, although it may sometimes be construed as such if one is trying to make a case for fully utilising what we have. I readily declare my interests here as someone who spent 23 years on the railways and as a Member sponsored by the National Union of Railwaymen. Sometimes, when we argue for the full utilisation of our railway services, it is assumed that we are attacking the road lobby. That is not necessarily so. If we have the present system and the mileage it provides, surely it makes sense to utilise it fully. It is owned by the nation and it must make sense to use it to the full. Before taking up expensive alternatives it makes sense to determine whether it is fully used. If it is not, why not? Is it being run efficiently?
I shall be charitable to Conservative Members and say that they sometimes do not study such matters as manning as deeply as they might. My hon. Friend the Member for Leicester, East (Mr. Bradley), the present Chairman of TSSA, spoke a short while ago about the reduction in the number of railwaymen employed by British Rail in the past year. The total has been reduced from 400,000 to 200,000. The railway unions have entered into agreement with the British Railways Board on manning, recruitment, overtime levels, rest-day working, Sunday-working and the like.
It has been agreed that when a vacancy occurs, whether it is on the shop floor, in management or wherever, it will not be filled until a full examination and a critical analysis has taken place. However, a massive amount of overtime continues to be worked. Far from being over-manned, railway employers are being stretched to the limits. The average amount of overtime now being worked results in a working week of 51 hours or 52 hours in every grade except engine drivers. It is 52 hours for signalmen, 52 hours for platform staff, 52 hours for permanent way and 52 hours for technicians. If these men refused to work overtime, the system would come to a standstill. Let there be a proper analysis of what is taking place.

Mr. Geoffrey Johnson Smith: I know that the hon. Gentleman wishes to be brief and does not intend to mislead the House. Although I fully appreciate the efforts that are being made by the work force of British rail, the hon. Gentleman will appreciate that by every yardstick we can possibly use to compare the efficiency of British Rail with the rail system of any other country in Western Europe, British Rail is by far the worst and bottom of the league. A great deal of progress has yet to be made.

Mr. Bagier: But the progress is being made. We cannot all of a sudden throw a heck of a lot of people on the scrap-heap, people who put their whole livelihood at stake inside the industry. Those representing the men have made massive strides towards increasing efficiency. In the past year there has been a 7,406 reduction in the number of jobs. By common agreement there is no intention to fill the 9,000 vacancies that now exist.
The consequence is that when we reach rock bottom and have no spare capacity we shall not be able to handle a growth economy. If there is no spare capacity and there is a spate of sickness, there will have to be a reduction in the train services. In any service industry there is a limit to how far it can be reduced before it is seriously harmed. There is, for example, the problem of handling peak period traffic.
Recently my union and the other rail unions suggested the possibility of bringing more passengers onto the rails by


reducing fares. I know that it has been pooh-poohed in some quarters, but there is a limit to how far we can soak passengers for fares. I hope to carry some Conservative Members with me in advancing this argument. The fare structure has seen a dramatic increase over the past two years.
Let us consider Bletchley, which is attached to the new town of Milton Keynes. It might well be assumed that the whole idea of new towns for overspills from London is to encourage people to move out and to work in the new towns, but many people are still working in London. The rate for an annual season ticket prior to 26th January 1975 was £223. On 26th January 1975 the rate was increased to £251. Four months later it was £311. Four months later it was £359. Three months later it was £398. On 2nd January 1977 it was increased to £453. That is an increase of £203 per annum or 103 per cent. To meet the increase, a man paying the standard rate of income tax needs a salary increase of £354. These are tremendous costs to pile on commuters.
The Board may well take the view that commuters have no choice, that there is no other way of travelling into London. But in the area I represent and in Scotland, Wales and elsewhere the people have a choice. Such cost escalation tips the balance when a man is considering buying a car or using some other mode of transport.
We must remember what Professor Colin Buchanan said some time ago about traffic in towns. We must provide good, cheap public transport if we are not to allow our towns to come to a standstill.

Mr. Forman: Where does the hon. Gentleman think the fault lies, and what can be done about it?

Mr. Deputy Speaker: I remind the hon. Member for Sunderland, South (Mr. Bagier) that it was the intention that the winding-up speeches should start at 11.25 p.m.

Mr. Bagier: My reply to the hon. Gentleman is that we must search our consciences. Hon. Members must start considering whether they believe that there is a social cost which should be met by the Government, whether they are

opposed to all aspects of public expenditure.
I was very surprised to read in The Times on Tuesday a report of a speech by Lieutenant-Colonel McNaughton, Chief Inspecting Officer of Railways, Department of the Environment, according to which he had told the Institution of Mechanical Engineers that there could be a reduction in safety standards on certain branch lines. Perhaps I am being unfair, in that I am quoting a newspaper report. He and his predecessors have gained a great deal of experience, and the railways have a wonderful safety record. I hope that my right hon. Friend will ask Lieutenant-Colonel McNaughton to give a full report on exactly what he means. He may well be able to provide knowledge that will cut down some of the very expensive equipment that must be provided at present on many of our branch lines.
This has been the first opportunity to debate transport for some years. We wish my right hon. Friend well. He has a knowledge of the railways and an interest in the industry. The railway unions also have a great deal of admiration for Mr. Peter Parker, and we wish him well.

Mrs. Gwyneth Dunwoody: On a point of order, Mr. Deputy Speaker. Before the hon. Member for Ashford (Mr. Speed) sums up the debate for the Opposition, I should like to protest most vehemently about the length of time given to the debate. A number of hon. Members on both sides of the House are still waiting to speak, in spite of the discipline exercised by some, but not all, hon. Members.

Mr. Deputy Speaker: That is not a point of order.

11.28 p.m.

Mr. Keith Speed: We have seen that even at this late hour on a Thursday evening many hon. Members wish to take part in the debate. I hope that the Secretary of State will tell his right hon. Friend the Leader of the House that there is still a great deal of bottled-up emotion on the subject and that there are many good ideas still to be heard. I hope that it will be possible to have another debate before the White Paper comes out.
The debate has perhaps sounded the death knell of the integrated transport policy. Admittedly, one or two Labour Members made obeisance to that policy, but I am not sure that they were aware what it was. I was interested to note that the Secretary of State did not refer to it, and I think that the consultation document and the debate have marked its demise.

Mr. Sydney Bidwell: rose—

Mr. Speed: I do not have time to give way.
The right hon. Member for Battersea, North, (Mr. Jay) argued from the Back Benches that there should be a higher tax on heavy lorries. If that is so, there should be a lower tax on smaller lorries, as I believe that the balance as regards track costs is about right. But the right hon. Gentleman let the cat out of the bag when he said that his proposal was a way to raise extra tax revenue.
However, I agree with the hon. Gentleman and with the hon. Member for Mitcham and Morden (Mr. Douglas-Mann) and my hon. Friend the Member for Carshalton (Mr. Forman), who raised the problem of the M23—the problems arise elsewhere throughout the country—where the line of a road has been known for far too long and there are problems of uncertainty and blight. This is something that the House as a whole has failed to recognise fully in the past and, in his considerations of road planning, I hope that the right hon. Gentleman will pay particular attention to this aspect. I believe that the continuation of this situation is not satisfactory.
The hon. Member for Brigg and Scunthorpe (Mr. Ellis) made an interesting speech, in which he asked why there should be toll roads. The simple answer is that we are more likely to get something built with a toll road than without a toll road. That was certainly an argument that weighed with the Treasury when I was at the Ministry of Transport.
The hon. Gentleman also strongly advocated the National Transport Council, which is mentioned in the Consultation Document. I got the impression that the Secretary of State was not so

enamoured of the National Transport Council; nor was the hon. Member for Isle of Wight (Mr. Ross). I am sure that they are right not to be enamoured of such a concept. I could conceive of no better way of delaying action than by having vast bodies of people coming to the National Transport Council.
I believe that we now have the set-up right, with a Department of Transport with a Secretary of State in the Cabinet answerable to the House. This is where the decisions should be taken, provided that there are more frequent debates on the subject of transport.
I welcome the fact that there is to be an annual White Paper on roads. I have grave reservations about an annual White Paper on railways. After all, there is the annual report of the British Railways Board, and the debate could take place on that and on the views of the Chairman of the Board.
The hon. Member for Derby, South (Mr. Johnson) raised a number of important points, if only to be controverted. He spoke more than once about wasteful competition. The hon. Member for Sunderland, South (Mr. Bagier) echoed some of his views. The hon. Gentleman gave us an example of the route from London to Glasgow—a city with which you are well acquainted, Mr. Deputy Speaker. He said that a traveller could fly to Glasgow, he could go by road up the M6 and then up the road to Scotland, or, alternatively, he could go by British Rail Inter-City.
There are different reasons—the time of day, for example—why people use different modes of transport to that city. If somebody were to lay down that Inter-City was the way to get from London to Glasgow, he would be imposing a dictatorship in denying the consumer his choice. That is not a sound base for a transport policy.
I had much more sympathy with the hon. Gentleman's view about the problems of investment for British Railways. Every time our economy hiccups, as it does frequently, the investment plans of British Rail, particularly its electrification plans, are cut back. This means that investment is very much more expensive than it otherwise need have been. The Secretary of State will agree with this


point. It was true under the last Conservative Government, and it is true under this Government.
We must devise a system—not only for rail investment, but for road investment—so that we do not lead people, whether they are contractors for overhead electrification or makers of roads, to invest in expensive plant and equipment only to find that, following a hiccup in the economy, there is a cut-back on capital projects and, therefore, the cost of building the road or doing the electrification is much more than it would otherwise have been.
The hon. Member for Isle of Wight argued that British Railways should dispose of more of their assets to provide much-needed funds. I entirely agree with him, but he will know that their task is much more difficult now that the Community Land Act is in operation, as all the nationalised industries are making clear to the Government.
Then the hon. Gentleman spoke about productivity, as did the hon. Member for Sunderland, South and my hon. Friend the Member for East Grinstead (Mr. Johnson Smith). The facts are given on page 61 of the consultative paper. The Board of British Railways, particularly its new Chairman, and the trade unions should have page 61 enlarged and pinned up on the wall in their headquarters. It shows what we should be aiming at when comparing railways in Britain with railways in overseas countries. There is considerable scope for co-operation all round and for an improvement in productivity.
One of the messages that has come out of the debate is that there is a future for British Rail, that it has a job to do. One of the ways they can look after their own jobs, employment and future is by ensuring that this productivity and these targets are met as far as possible. I do not want to bandy about statistics on cuts in the numbers employed or to suggest that they could have done better. The facts are in the Government's paper for them to see, and they should be a challenge and a spur to unions, management and all those with the interests of the railways at heart.
A great deal was said about commuters, especially by my hon. Friend the Member for Tonbridge and Malling (Mr.

Stanley), in his very thoughtful speech. He rightly pointed out the effects, especially on London, if the commuter traffic dwindled and died, to say nothing of the importance of the commuter to the life of this great city. Various examples were given by hon. Members on both sides of the House of the considerable costs of commuting now. In my own constituency, for the journey between Ashford and London the cost of an annual season ticket is now running at about £500, which means that a person paying tax at the standard rate must earn about £800 a year to pay for it. The law of diminishing returns may be beginning to operate. This would be very bad, not only for British Rail but for London as well.
I am interested in identifying the costs of the apparent loss of this commuter traffic much more frankly than the consultative document does and much more than British Rail have been prepared to reveal so far. I say "so far", because I have the impression that in this regard the new Chairman of British Rail will be more forthcoming than his predecessors. If he is, it can only be good. At least if commuters realise the problems and British Rail are totally open and frank with them, it will help hon. Members, commuters and everyone else who is trying to cope with this problem.
The hon. Member for Derby, South referred to the capital being tied up at peak hours. We know the number of coaches and locomotives which are apparently tied up to take passengers for just a few hours in the day. I should like more information about this. Is not it possible to give a very hard incentive to employers to stagger working hours in a way that perhaps we have not even considered yet? In that way, we could spread the working load. The working day might start for some people at 7 o'clock in the morning, for others at 10 o'clock and for others at 11 o'clock. After all, we have Flexitime, and much more enlightened employment policies now. If we knew what could be saved by extending the peak hours by half an hour or an hour each way, that again could result in the more efficient utilisation of stock and perhaps a curb in the ever-increasing fares.
Rural transport has not received enough attention in the debate, although my hon.


Friend the Member for Lancaster (Mrs. Kellett-Bowman) referred to it. It was a significant omission from the speech of the Secretary of State. My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) referred to the problems of rural transport and reminded us of the way that Clauses 16 to 19 of the Road Traffic Bill, which my right hon. Friend the Member for Yeovil (Mr. Peyton) introduced three years ago on 30th January, after it had been through another place, would have given much greater flexibility in licensing and would have allowed to be done the experiments now proposed by the Government. It would have meant many small vehicles in rural areas being able to take passengers without the almost insuperable difficulties which exist at the moment. This would have gone a long way to solving the vexed problems of rural transport. It is not just a matter of costs. It is the fact that in many places there is no rural transport at all, unless people can beg lifts from friends or neighbours, assuming that they have no private transport of their own.
As a number of hon. Members have said, including my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller), the car has brought real freedom to many millions of working men and women in a way that nothing else has, with the possible exception of the washing machine for the housewife. Industrial workers in Birmingham, Nottingham and Leicester, on a Saturday or Sunday afternoon, can get out to the Dales, to the Lake District, or to Blackpool, and no one denies them that kind of freedom. I resent the intellectual arrogance of those who always manage to get to these spots but who, once they begin to get popular, complain how terrible it is and how congested the roads to the Lake District or to Blackpool are becoming.
The motorway programme followed, all through the 1960s, from a statement made by the right hon. Member for Sheffield, Park (Mr. Mulley) in May, 1970, and endorsed by my right hon. Friend the Member for Worcester (Mr. Walker) in 1971, and the right hon. Member for Grimsby (Mr. Crosland) in 1975, and never seriously challenged by this House.
It is a matter of great regret to me that now that capital is being cut back, subsidies are apparently to continue. Since there is a great delay now in the road programme, perhaps the Minister would tell us what future the road construction units have. Are the Government's priorities still the M25 around London and first-class access roads from the ports to the main industrial centres?
Could the Minister tell us what progress has been made on the quiet heavy goods vehicles programme? This was launched by the last Government with a contract, and great progress was being made. This is something which is very important to the environment, and therefore, in the long term, to very many people. Then there is the question of motorways providing a good environmental solution The M6 through Lune Gorge, and the M5 in Somerset have improved the environment, rather than detracted from it.
Where there are railway operations that are essential socially, but have no prospect of financial viability, these should be identified and helped accordingly. The help should not be open-ended, and should not be given in a way which will kill off management skills, enterprise, and expertise. The common carrier concept is the worst enemy of the railways. It is legally dead, but unfortunately its spirit lives on in some hon. Members opposite, and some people outside. It does the railways no good at all.
There are many problems associated with getting a strong and viable transport system, and these problems are not helped by consistent cut-backs in capital programmes of road and rail investment. For many years to come, money will be limited, so we must ensure that we get good value for money in all investment. I refer here to investment for road safety, not just for road building and maintenance. I am concerned about the way the road building programme has been cut and cut again, because good roads are an extension of our production lines and important to our economic survival.
This debate will help the Secretary of State in planning the White Paper which we hope to have in a month or two. There is still much to be done, but we are on the right road.

11.43 p.m.

The Under-Secretary of State for Transport (Mr. John Horam): Like many hon. Members I am sorry about the lateness of the hour at which this debate began. It is only the House of Commons which could plan a debate on transport which finished after the last trains, and certainly most sleepers, had gone.
Transport has had rather a rough deal over debating time in this House. The last full debate in Government time which covered transport policy as a whole was as long ago as 1968. The occasion was the publication by my right hon. Friend the Member for Blackburn (Mrs. Castle) of the White Paper which preceded the Transport Bill. That seems to have been the last full-blown transport debate. One could sense the pent-up frustration in my hon. Friend the Member for Crewe (Mrs. Dunwoody), and I am sure that the Opposition felt this too. Perhaps they will think about providing some Supply time—and I do not make that as a debating point. If we want to debate transport we should not wait another eight years. I do hope that the Opposition will respond.

Mr. Bidwell: Would my hon. Friend accept that, as a member of the TGWU, I have been sitting here waiting to put the official case on behalf of my union, which has not yet been put in the debate?

Mr. Horam: At least my hon. Friend got in to say that. I am sure that he will forgive me if I do not pursue his point.

Mr. Tim Rathbone: rose—

Mr. Horam: No, I will not give way. I ask hon. Members to remember that I have sacrificed 15 minutes of my time, as has the hon. Member for Ashford (Mr. Speed).
During these past years we have had three or four debates on economic policy each year—sometimes more. If we had debated transport more, and gone further towards solving its problems, we might have been able to debate the state of the economy less.
A debate such as we have had today, therefore, is certainly overdue. We transport enthusiasts have shown great restraint. I say "we transport enthusi-

asts" because I, like my right hon. Friend, have a history of interest and activity in transport. Since I shall get no other opportunity tonight of mentioning my personal views on transport I should like to mention the Expenditure Committee Report on Urban Transport Planning which was produced in 1972 and of which I was an author.
This formed the basis of the section on urban transport in Labour's Programme 1973, and I believe that two of its judgments in particular have stood the test of time. The first is the importance of the bus industry, which was mentioned by many hon. Members, particularly the hon. Member for Christchurch and Lymington (Mr. Adley). I recognise the importance of the point that he has made on a number of occasions. The second is the wisdom of restraining urban road building. These judgments were contained in the view of the report that we should
make the best use of the present road system before adding substantially to it".
On this latter point our report was quoted in the consultative document, which is perhaps why I think that document has something to be said for it as a starting point for our debate tonight.
I noted the attempts of my hon. Friend the Member for Preston, South (Mr. Atkins) to transfer the debate on to the subject of the NEC document. He did not wholly succeed in that purpose, although I fully recognise the value of his points.
My right hon. Friend the Member for Battersea, North (Mr. Jay) asked for some specific figures about the effects of the cuts in the road programme in August and December. He mentioned the figure of £680 million for Great Britain as the amount before the cuts were made. We do not have comparable figures to hand because our figures relate principally to England, for which we have specific responsibility. In addition, he was talking in terms of 1974 prices, and our figures are in 1975 prices. However, taking account of these points, roughly the effect on trunk roads has been to reduce the amount by about £100 million, which is about a quarter of the total programme. On local roads the effect has been roughly to halve the programme as between this year and next.
In stating these figures I am certainly conscious of the remarks of my hon. Friend the Member for Wigan (Mr. Fitch) and the hon. Members for Bromsgrove and Redditch (Mr. Miller) and Ashford (Mr. Speed), which were in many respects cogent and informed, about the advantages of mobility which have been brought to all sections of the population by the revolution in car transport over the last 20 years. I would say to the hon. Member for Ashford that our priorities remain the M25, access to the ports, and roads with a high industrial rating.
I have recently written to the hon. Member for Bury St. Edmunds (Mr. Griffiths) on the subject of the quiet lorry. This was the particular concern of some Conservative Members when they were in office.
The hon. Member for Tonbridge and Malling (Mr. Stanley) made an interesting speech on the subject of commuters. He will forgive me if I do not go into it in detail. We had two debates on the subject just before Christmas. Those debates were replied to by my right hon. Friend and myself. I note the hon. Member's point about the crucial relationship between take-home pay and the cost of the season ticket.
My hon. Friends the Members for Derby, South (Mr. Johnson), Preston, North and Sunderland, South (Mr. Bagier), and the hon. Member for Isle of Wight (Mr. Ross) referred to the coordination of transport policy. Part of the answer here, as my hon. Friend the Member for Brigg and Scunthorpe (Mr. Ellis) so wisely said, is that we are building from the bottom. Our Transport Act 1968 created the PTAs and the executives and gave them the duties of securing a properly integrated transport system. There are some very good examples of the progress made since then. For example, there is the Tyne and Wear Metro. Another is the bus-rail interchanges which are being built in many areas. The Midlands travel card is a good example of co-ordination of the right kind.
Last October my right hon. Friend and the Greater London Council set up the London Rail Advisory Committee to consider investment and general fares issues, as well as operational matters and

interchange facilities. That is a further example of a co-ordinated approach to transport policy.
At national level the issues are different in character. My hon. Friends will have noted the proposal in the consultation document for a study of inter-urban passenger demands. Preparatory work for that study is in hand.
My hon. Friend the Member for Newton (Mr. Evans) challenged the consultation document on the ground that it takes no account of EEC policy and the effects of that policy on costs. If that were so, his point would be correct. However, in considering the balance between road and rail, despite the admitted difficulties of securing comparable figures, the document states, in paragraph 8.3 that even the "cumulative effect" of all the major EEC policies, such as drivers' hours and other matters, would be
unlikely to alter radically the distribution between road and rail.
That gives some idea of the situation.

Mr. John Evans: Will my hon. Friend—

Mr. Horam: I should be grateful if my hon. Friend would not intervene now, as I have very few minutes left to complete my speech.

Mr. John Evans: Will he answer the point about quantifying the figures?

Mr. Horam: There are problems about quantifying the figures now, but I shall write to my hon. Friend about that matter. There are difficulties of comparability, but we shall do our best.
The right hon. Member for the Western Isles (Mr. Stewart) and the hon. Member for Carmarthen (Mr. Evans) will, I hope, forgive me when I say that their remarks have been noted by the Minister of State, Scottish Office, and the Under-Secretary of State for Wales. My hon. Friend unavoidably could not be here, but he will take account of the remarks which have been made when he reads Hansard and will write to the hon. Member for Carmarthen on the specific points which he made.
My hon. Friend the Member for Brigg and Scunthorpe referred to the ferry on the Humber. Any decisions to withdraw any of the British Railways services involved on the Humber—either the ferry


or the linking rail services to New Holland—can be taken only under procedures laid down in the Transport Acts. Those procedures ensure that local interests shall have an opportunity of making known their views before any final decisions are reached. I know of no proposals by the British Railways Board to discontinue any services on the Humber crossing.
The hon. Member for Sutton Cold-field (Mr. Fowler) and other Opposition Members referred to the allocating of British Railways' costs. That is not a new point. The study by the National Economic Development Office on the nationalised industries brought out the importance of that matter. That study was published last year. All Governments have encountered problems in moving towards that desirable end. I think that most concern has been expressed about the densely packed commuter lines of the South-East. How can we allocate the costs of the Borough Market Junction, which is used by many services? Even the 1968 Act, which dealt with this matter more thoroughly than it had been considered before, did not distinguish between services in the South-East because of the difficulty of doing so. Obviously the British Rail-ways Board and the Government are looking at this problem in a positive way.
My hon. Friend the Member for Sunderland, South referred to remarks made by Lieutenant-Colonel McNaughton. I ask him to look at those remarks in their true context. I have arranged for a copy of the lecture to be placed in the Library of the House so that hon. Members can look at it.
Our aim in the forthcoming White Paper will be to mark out a secure, long-term rôle for the railways. There are a number of areas where railways, if operated and marketed with efficiency and planned for with skill, have a clear advantage over other modes of transport and should have a solid and viable future.
Like every other part of transport the railways need to adapt to change. But they have the ability to do so. On my appointment I was caricatured in The Economist as a "railway enthusiast". I am indeed—after so many years spent travelling by train between London and

Newcastle, how could I not be? But I know that there are solid grounds for my enthusiasm.
The hon. Member for Sutton Coldfield and other hon. Members raised the important problem of transport in rural areas. The first essential is to give priority, within the resources that we can afford for bus revenue support, to keep essential but uneconomic conventional bus services going in rural areas. This is something that we have encouraged county councils to do as an immediate step. For 1977–78 we therefore accepted for Transport Supplementary Grant purposes about £37 million—at November 1975 prices—for bus revenue support in the shire counties. That is very nearly the whole of what we were asked for.
A second line of approach is for county councils and operators to exercise the kind of creative effort to which I have referred in order to rejig conventional services in to something better suited to demand. If present trends continue we shall have to look at unconventional services, and that raises the question of licensing. The arguments here should be examined carefully, but I would remind hon. Members that we still have far more bus services than neighbouring countries, despite a similar level of car ownership. Moreover, if our problem is that one bus is only carrying half-a-dozen people it would take the most doctrinaire supporter of universal competition to suggest that the solution was to have two buses carrying three each.
Traffic commissioners are not always totally preoccupied with services between London and Moscow. We should not throw the baby out with the bath water. Present licensing arrangements do have some odd side-effects and prevent us from using some of the possible unconventional methods. The problem is how to ease restrictions on initiative and experiment dictated by the needs of particular areas without losing the orthodox bus service, which is still the right thing for many country routes.
It is to find answers to this that we are setting up the rural transport experiments. In four areas of Great Britain we are first looking at ways of improving normal bus services, within the same resources and then filling the gaps with unconventional services—post buses,


school buses, car-pooling, minibuses, unconventional taxi services—and then monitoring the results. The Passenger Vehicles (Experimental Areas) Bill that we shall be introducing shortly will enable the experiments to be conducted without being cramped by the existing licensing system.
An hon. Member of the Opposition asks why we did not do that in 1974 or 1975. A more pertinent question would be to ask why it was not done in 1973 or 1972. This is the right pragmatic approach, looking at the problems on the ground. If the Opposition had not gone ahead with their all-or-nothing policy when they were in office, we would have made far more progress on the matter than we have done over the last few years.
The hon. Member for Carshalton (Mr. Forman) raised the question of blight. This is a problem that has concerned us all when studying urban road building. We must look long and hard before building a road and we must fit it into its surroundings sensitively. The M6 has been mentioned as a good example of

Division List No. 42 [See c. 707]


Division No. 42.]
AYES
[7.3 p.m.


Anderson, Donald
Ellis, John (Brigg &amp; Scun)
John, Brynmor


Archer, Peter
Ennals, David
Johnson, James (Hull West)


Armstrong, Ernest
Evans, Fred (Caerphilly)
Johnson, Walter (Derby S)


Ashton, Joe
Evans, Gwynfor (Carmarthen)
Johnston, Russell (Inverness)


Atkinson, Norman
Evans, loan (Aberdare)
Jones, Barry (East Flint)


Bagier, Gordon A. T.
Evans, John (Newton)
Jones, Dan (Burnley)


Barnett, Guy (Greenwich)
Ewing, Harry (Stirling)
Kaufman, Gerald


Barnett, Rt Hon Joel (Heywood)
Faulds, Andrew
Kelley, Richard


Bates, Alf
Fletcher, Ted (Darlington)
Kerr, Russell


Booth, Rt Hon Albert
Foot, Rt Hon Michael
Kilroy-Silk, Robert


Bottomley, Rt Hon Arthur
Forrester, John
Kinnock, Neil


Bradley, Tom
Freeson, Reginald
Lambie, David


Brown, Ronald (Hackney S)
Garrett, John (Norwich S)
Lamond, James


Butler, Mrs Joyce (Wood Green)
Garrett, W. E. (Wallsend)
Latham, Arthur (Paddington)


Canavan, Dennis
George, Bruce
Lipton, Marcus


Carmichael, Nell
Gilbert, Dr John
Litterick, Tom


Clemitson, Ivor
Ginsburg, David
Loyden, Eddie


Cocks, Rt Hon Michael (Bristol)
Golding, John
Lyon, Alexander (York)


Coleman, Donald
Gould, Bryan
Lyons, Edward (Bradford W)


Colquhoun, Ms Maureen
Graham, Ted
Mabon, Rt Hon Dr J. Dickson


Cook, Robin F. (Edin C)
Grant, John (Islington C)
McDonald, Dr Oonagh


Corbett, Robin
Grocott, Bruce
McElhone, Frank


Cowans, Harry
Hamilton, James (Bothwell)
MacFarquhar, Roderick


Cox, Thomas (Tooting)
Hamilton, W. W. (Central Fife)
Mackintosh, John P.


Craigen, Jim (Maryhill)
Harper, Joseph
Maciennan, Robert


Crawshaw, Richard
Harrison, Walter (Wakefield)
McMillan, Tom (Glasgow C)


Crowther, Stan (Rotherham)
Hart, Rt Hon Judith
Madden, Max


Cunningham, Dr J. (Whiteh)
Hayman, Mrs Helene
Marks, Kenneth


Davidson, Arthur
Hooley, Frank
Marshall, Jim (Leicester S)


Davies, Bryan (Enfield N)
Horam, John
Maynard, Miss Joan


Davies, Denzil (Llanelli)
Howell, Rt Hon Denis (B'ham, Sm H)
Meacher, Michael


Davis, Clinton (Hackney C)
Hoyle, Doug (Nelson)
Mendelson, John


Deakins, Eric
Hughes, Rt Hon C. (Anglesey)
Millan, Rt Hon Bruce


Dean, Joseph (Leeds West)
Hughes, Robert (Aberdeen N)
Miller, Dr M. S. (E Kilbride)


Dell, Rt Hon Edmund
Hunter, Adam
Miller, Mrs Millie (Ilford N)


Dormand, J. D.
Irving, Rt Hon S. (Dartford)
Morris, Alfred (Wythenshawe)


Douglas-Mann, Bruce
Jackson, Colin (Brighouse)
Morris, Charles R. (Openshaw)


Dunnett, Jack
Jackson, Miss Margaret (Lincoln)
Mulley, Rt Hon Frederick


Edge, Geoff
Jay, Rt Hon Douglas
Newens, Stanley


Edwards, Robert (Wolv SE)
Jenkins, Hugh (Putney)
Noble, Mike

this. We should not keep schemes alive when the chances of them being completed are almost nil. In Liverpool, one-third of the land investigated in an inner area study was found to be set aside for road schemes that were years from realisation. The Government have asked local authorities to study their proposals for roads that are not planned for starts before 1978, with the object of releasing land.

There is a rôle for all of us in transport, whether we are politicians, administrators, operators, critics, or simply passengers. But it must be a creative rôle. There is a pronounced tendency in this area for the continual re-statement of entrenched positions. That will not do, because if it persists, we shall not solve our problems in a way that we like. And, if we do not solve them in a way we like, I remind the House that they will be solved for us in a way that we do not like.

Question put and agreed to.

Resolved,
That this House takes note of the Consultation Document on Transport Policy.

Ogden, Eric
Sheldon, Rt Hon Robert
Weetch, Ken


Orbach, Maurice
Shore, Rt Hon Peter
Weitzman, David


Ovenden, John
Sillars, James
White, Frank R. (Bury)


Parker, John
Silverman, Julius
Whitehead, Phillip


Pavitt, Laurie
Skinner, Dennis
Whitlock, William


Penhaligon, David
Small, William
Wigley, Dafydd


Phipps, Dr Colin
Spearing, Nigel
Willey, Rt Hon Frederick


Prescott, John
Spriggs, Leslie
Williams, Rt Hon Alan (Swansea W)


Price, C. (Lewisham W)
Stallard, A. W.
Williams, Alan Lee (Hornch'ch)


Price, William (Rugby)
Stewart, Rt Hon M. (Fulham)
Williams, Rt Hon Shirley (Hertford)


Radice, Giles
Stoddart, David
Williams, Sir Thomas (Warrington)


Rees, Rt Hon Merlyn (Leeds S)
Strang, Gavin
Wilson, Rt Hon Sir Harold (Huyton)


Roberts, Gwilym (Cannock)
Summerskill, Hon Dr Shirley
Wilson, William (Coventry SE)


Roderick, Caerwyn
Taylor, Mrs Ann (Bolton W)
Wise, Mrs Audrey


Rodgers, Rt Hon William (Stockton)
Thomas, Ron (Bristol NW)
Woodall, Alec


Rooker, J. W.
Tierney, Sydney
Woof, Robert


Roper, John
Tomlinson, John
Young, David (Bolton E)


Rose, Paul B.
Walden, Brian (B'ham, L'dyw'd)



Ryman, John
Walker, Terry (Kingswood)
TELLERS FOR THE AYES:


Sandelson, Neville
Ward, Michael
Mr. peter Snape and


Sedgemore, Brian
Watkins, David
Mr. James Tinn.


Shaw, Arnold (Ilford South)
Watkinson, John





NOES


Adley, Robert
Gorst, John
Page, Richard (Workington)


Alison, Michael
Gow, Ian (Eastbourne)
Pardoe, John


Atkins, Rt Hon H. (Spelthorne)
Grant, Anthony (Harrow C)
Parkinson, Cecil


Baker, Kenneth
Griffiths, Eldon
Pattie, Geoffrey


Bell, Ronald
Grylls, Michael
Percival, Ian


Berry, Hon Anthony
Hall, Sir John
Raison, Timothy


Biffen, John
Hamilton, Michael (Salisbury)
Rathbone, Tim


Body, Richard
Hannam, John
Rawlinson, Rt Hon Sir Peter


Boscawen, Hon Robert
Hawkins, Paul
Rees, Peter (Dover &amp; Deal)


Bowden, A. (Brighton, Kemptown)
Hodgson, Robin
Renton, Rt Hon Sir D. (Hunts)


Boyson, Dr Rhodes (Brent)
Holland, Philip
Renton, Tim (Mid-Sussex)


Braine, Sir Bernard
Hooson, Emlyn
Rhodes James, R.


Brittan, Leon
Howe, Rt Hon Sir Geoffrey
Ridley, Hon Nicholas


Brockiebank-Fowler, C.
Howell, David (Guildford)
Rifkind, Malcolm


Bulmer, Esmond
Hunt, David (Wirral)
Roberts, Wyn (Conway)


Butler, Adam (Bosworth)
Hurd, Douglas
Rodgers, Sir John (Sevenoaks)


Carlisle, Mark
Irving, Charles (Cheltenham)
Ross, Stephen (Isle of Wight)


Cnalker, Mrs Lynda
James, David
Rost, Peter (SE Derbyshire)


Channon, Paul
Johnson Smith, G. (E Grinstead)
Sainsbury, Tim


Churchill, W. S.
Jones, Arthur (Daventry)
Scott, Nicholas


Clark, Alan (Plymouth, Sutton)
Kellett-Bowman, Mrs Elaine
Shaw, Giles (Pudsey)


Clark, William (Croydon S)
Kimball, Marcus
Shepherd, Colin


Clarke, Kenneth (Rushcliffe)
King, Tom (Bridgwater)
Shersby, Michael


Clegg, Walter
Knight, Mrs Jill
Silvester, Fred


Cooke, Robert (Bristol W)
Knox, David
Sims, Roger


Cope, John
Lawrence, Ivan
Sinclair, Sir George


Corrie, John
Le Marchant, Spencer
Smith, Dudley (Warwick)


Costain, A. P.
Lester, Jim (Beeston)
Speed, Keith


Craig, Rt Hon W. (Belfast E)
Lewis, Kenneth (Rutland)
Spicer, Michael (S Worcester)


Crowder, F. p.
McAdden, Sir Stephen
Stanley, John


Dean, Paul (N Somerset)
Macfarlane, Neil
Stewart, Ian (Hitchin)


Dodsworth, Geoffrey
MacGregor, John
Stradling Thomas, J.


Durant, Tony
McNair-Wilson, M. (Newbury)
Taylor, R. (Croydon NW)


Dykes, Hugh
Madel, David
Tebbit, Norman


Eden, Rt Hon Sir John
Marten, Neil
Thatcher, Rt Hon Margaret


Edwards, Nicholas (Pembroke)
Mates, Michael
Thomas, Rt Hon P. (Hendon S)


Emery, Peter
Mather, Carol
Thorpe, Rt Hon Jeremy (N Devon)


Eyre, Reginald
Maxwell-Hyslop, Robin
Viggers, Peter


Fairgrieve, Russell
Mayhew, Patrick
Walder, David (Clitheroe)


Farr, John
Miller, Hal (Bromsgrove)
Wall, Patrick


Finsberg, Geoffrey
Moate, Roger
Walters, Dennis


Fisher, Sir Nigel
Montgomery, Fergus
Weatherill, Bernard.


Fletcher, Alex (Edinburgh N)
Morris, Michael (Northampton S)
Whitelaw, Rt Hon William


Fookes, Miss Janet
Morrison, Charles (Devizes)
Wiggin, Jerry


Forman, Nigel
Morrison, Hon Peter (Chester)
Winterton, Nicholas


Fowler, Norman (Sutton C'f'd)
Neubert, Michael
Wood, Rt Hon Richard


Fry, Peter
Newton, Tony



Godber, Rt Hon Joseph
Nott, John
TELLERS FOR THE NOES:


Goodhart, Philip
Onslow, Cranley
Mr. Nigel Lawson and


Goodhew, Victor
Page, John (Harrow West)
Sir George Young.


Goodlad, Alastair
Page, Rt Hon R. Graham (Crosby)

Orders of the Day — NORTHWOOD, PINNER AND DISTRICT HOSPITAL

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Tinn.]

12.2 a.m.

Mr. F. P. Crowder: I am glad to have the opportunity to raise the subject of the future of the Northwood, Pinner and District Hospital. I shall endeavour to do so in a short time and at a speed with which the shorthand writers can cope—in contrast to the previous two speeches which, although excellent, were like turning on both bath taps at the same time—though I appreciate the problems facing both hon. Members.
We have only a short time for this debate and my parliamentary neighbour, my hon. Friend the Member for Harrow, West (Mr. Page) wishes to intervene. I apolgise to the Chair and to the servants of the House for raising this subject at this late hour. I know that the House did not rise until about 6.20 yesterday morning.
A dark cloud and a very nasty threat—both of which are due to the economic circumstances—appeared over the future of the Northwood, Pinner and District Hospital in the autumn. I have been in contact with the Government and the Ministers concerned and I should like to take this opportunity of thanking them for the courteous and sympathetic manner in which they have dealt with the various problems which I have raised and entreaties which I have placed before them.
An area management team of the Hillingdon Area Health Authority was asked to investigate the implications of a partial or total closure of the Hayes Cottage and the Northwood, Pinner and District Hospitals. There are certain extracts from the team's report to the area authority to which I should like to draw attention. The most important is this:
In brief, however, it is clear that at present the closure of either hospital would adversely affect the health service offered by the authority to an extent which the Area Management Team would not wish to countenance.
Particular attention is drawn to the large surgical case load at both Hayes and Northwood Hospitals and to the difficulty of transferring any surgical work to other

Hillingdon hospitals where operating time is already committed, or to Mount Vernon, where the three theatres off "C" Block corridor have been closed for some time.
It is understood that if a new operating theatre were to be provided at Mount Vernon, the cost would be about £450,000.
Another important factor which was taken into account by the area management team was the very strong preference of the public in that area to being treated in smaller units. That view is supported by a large correspondence.
I shall explain the principal reasons against the closure. The district hospital is already a community hospital, right in the midst of an established and growing population. Thereby, it avoids inconvenient travel for old people, patients and visitors. The building and equipment is in first-class condition. I have been round the building on numerous occasions. It has an extremely efficient staff, supported by local general practitioners. Perhaps most important of all, it is a memorial to those who died in the First World War and was erected by public subscription.
A well attended meeting of residents was held about the matter. Petitions may not mean much, but about 14,000 signatures were collected in protest at the possible closure of the hospital.
I am concerned about the indication that nothing shall be done to close the hospital "at present". I suppose we are faced with an economic situation which must spell out such indications. Those were the words that concerned me. They led me to raise the matter on the Floor of the House. I hope that the words will be removed and that I shall convince the Minister accordingly.

12.8 a.m.

Mr. John Page: My constituents and I are grateful to my hon. and learned Friend the Member for Ruislip-Northwood (Mr. Crowder) for having arranged this Adjournment debate through the usual channels. The continuing operation and existence of this little hospital is of passionate interest to my constituents in Harrow, West which is across the border from my hon. and learned Friend's constituency.
The petition, with so many names, confirms the local enthusiasm for the


hospital. A cheer has gone up that this well-loved institution is to remain and continue to give the friendly, efficient, approachable and unfrightening service which it has given for the last 50 years and which we hope it will continue to give for the next 50 years. In-patients and out-patients will be extremely glad. Consultants, general practitioners, nurses and physiotherapy and administrative staff will be relieved and grateful that they can continue, in this atmosphere, to serve the public.
Now that this grey cloud has disappeared over the horizon, temporarily anyhow, I believe that it would be approriate for me to mention to the Minister, and bring to the attention of health authorities throughout the country, that it really is time for more information about comparative costs of services in small, old-type parish hospitals and services in the great new cathedrals of medical technology.
Rather bravely, I have said previously, inside and outside the House, that those of us who demand cuts in public spending must have the courage not to bellow when cherished local institutions are up for slaughter on the altar of economy. However, if we are to show this courage, which I know that my hon. and learned Friend and many hon. Members in all parts of the House would wish to do in the national interest, we must be given the figures on which financial judgments are made.
As a business man of some years standing, I am confident that if the servicing of new capital expenditure debt were taken into account, the public would find that it was getting better value for money at this small hospital and others like it than if the same surgical and medical treatments were given in great new hospitals. On 9th December the Minister of State told me, in a Written Answer, that comparative costs of treatments at different types of hospital were not available. However, I believe that it is impossible to make a proper economic judgment without having those figures.
I should like to give just two examples in connection with this hospital. The physiotherapy unit is housed in a little prefabricated hut, which was probably put up in the 1940s for about £1,000. In that hut a devoted, friendly staff have

looked after over 1,000 contented patients this year. In the tiny X-ray unit, we learn, from the answer to my Question, that 47,600 treatments were given.
I have a feeling amounting to a certainty that such treatments given in North-wick Park, Mount Vernon or one of the bigger hospitals must cost about three times as much, because of the infrastructure and other matters.
We are extremely grateful that the threat has been removed from this hospital. In being able to say "Thank you' to the Minister for that tonight—and how grateful we are—I hope that he will likewise consider seriously the necessity of providing more figures.

12.15 a.m.

The Under-Secretary of State for Health and Social Security (Mr. Eric Deakins): The hon. and learned Member for Ruislip-Northwood (Mr. Crowder) has spoken eloquently about the virtues and the services provided by small hospitals generally and made particular reference to the one which serves his own constituents—views which were strongly supported by his hon. Friend the Member for Harrow, West (Mr. Page). The views which they have voiced are I know widely held, for staff, patients and the public at large do become very attached to their local hospitals.
I say that feelingly because I am undergoing the same sort of agonies in my constituency, where our local hospital is to close at the end of this month in spite of all the efforts that have been made to save it. A small hospital, by its very size, and often because of its ready accessibility, does have an attraction all its own even when there is a district general hospital nearby with a full range of resources. The hon. and learned Gentleman has made it clear that many of his constituents are concerned and opposed to the possible closure of the Northwood, Pinner and District Hospital, with its 36 general practitioner beds. My right hon. Friend the Secretary of State was in fact well aware of this feeling for he received some weeks ago, a petition, to which the hon. and learned Member referred, signed by about 14,000 people, and there have been numerous representations both from Members of this House and elsewhere.
One of the major aims of the 1974 reorganisation of the National Health Service was the creation of a structure more suitable for planning and developing a comprehensive and integrated health service. The new authorities are now well established and are beginning to review in some detail the services which they have inherited with a view to rationalisation. Indeed, we are pressing them to do so. Simultaneously, we are taking positive steps to share out the financial resources available more equitably than the present distribution.
Decisions on closure or change of use of health buildings rest primarily with the appropriate area health authority—Hillingdon Area Health Authority in the case of Northwood, Pinner and District Hospital. I would here point out to the hon. and learned Member that, in line with our aim of providing for a more democratic health service, more sensitive to local needs, we have decided that area health authorities should have one-third local authority membership. The authority is therefore constituted to allow for the expression of local people on resource allocation.
Authorities are expected to reach their conclusions within the framework of a new planning system recently devised for the NHS and whose introduction is in an early evolutionary stage. Within this the Department issues national guidelines which at present are somewhat provisional in that they are based upon recommendations in the consultative document, "Priorities for Health and Personal Social Services in England". From these, regional and area health authorities develop regional and area guidelines in relation to a particular region or area. Following the general principles of such guidelines, strategic plans are prepared for 10 to 15 years ahead. These are to be regularly reviewed and updated and will form the basis on which each year operational plans for implementation over two or three years will be prepared.
Throughout this process there is much consultation, both formal and informal, so that plans may take full account of local views. It is from that process that we expect in due course that most proposals for closure or change of use of health buildings will emerge.

Nevertheless, because of the importance which we attach to full consultation before such decisions are taken, there is a recognised procedure for further consideration by all concerned when the time for decision has been reached. This procedure requires an area health authority to prepare a consultative document covering such matters as the reasons for its proposal; an evaluation of the possibilities of using the facilities for other purposes or the disposal of the site; implications for staff; the relationship between the closure or change or use and other developments and plans; and also, of course, the effect on patients who might be affected by the proposal, particularly in relation to transport facilities.
Comments on the proposals in the consultative document are invited within three months from such bodies as the local community health council, the associated local authorities, joint staff consultative committees and other staff organisations, family practitioner committees and local advisory committees, including the local medical committees. Hon. Members whose constituents would be affected would also be informed of the proposals and, if I may say so to the hon. Member for Harrow, West, there is nothing to prevent hon. Members or the community health council at that stage asking the area health authority for such cost figures as are available.
If the community health council, which is given the opportunity to study the comments of the other bodies consulted and the area health authority's views on those comments, objects to the proposals it is entitled to submit to the authority a constructive and detailed counter-proposal, paying full regard to the factors, including restraints on resources, which led the authority to make its original proposal. If the authority is unable to accept the counter-proposal the matter is referred to the regional health authority. If it, too, is unable to agree with the community health council and wishes the closure or change of use to proceed, it falls to my right hon. Friend the Secretary of State to act as arbiter.
Nothing I say today should be construed as prejudging the issue in any particular case; least of all the situation in relation to Northwood, Pinner and District Hospital where, as the hon. and


learned Member has already explained, the Hillingdon Area Health Authority has decided not to proceed, at least for the time being, beyond initial informal consideration. This aspect of the procedure is one which I would ask hon. Members to note, for it means that it will rarely be possible in this House to indicate in advance the likely outcome of any proposal.
The planning arrangements to which I referred earlier are, as I said, in an early stage of development. A number of proposals for closure or change of use currently coming forward have not therefore been subjected to that process. They are rather the result of some immediately pressing problem, albeit that the solutions proposed are strongly influenced by the planning guidelines already evolved. In these instances area health authorities are expected to conduct a substantial round of informal consultations in the first instance. If this produces a specific proposition the detailed procedures which I have already outlined for formal consultation and for submission to higher authority if necesary still apply.
Proposals in respect of Northwood, Pinner and District Hospital never reached this stage. The Hillingdon Area Health Authority, under pressure to find economies, asked its officers to explore the implications of closure. The officers' report led the authority last week to a decision not to proceed further.
Set out in this way, the procedures for effecting change may seem somewhat complex. Indeed, I know that in some quarters they are considered overelaborate and a deterrent to the redeployment of resources with maximum speed. It is essential, particularly at this time of economic constraint, that there should be no unnecessary barriers to impede the cost effective use of resources. On the other hand, the NHS must be responsive to the local views of both patients and staff, and to hon. Members. The system seeks to balance the need for speed with that for local and, where relevant, national consultation.
As I understand it, the thoughts of Hillingdon Area Health Authority turned to the possibility of closing Northwood, Pinner and District Hospital as part of a package of measures to overcome an overspending position which at one time during the year seemed to be on course

for an excess of £250,000 or more. In part, this derives from our having taken the first major step towards correcting some of the long-acknowledged inequities in the way in which resources available to the NHS are distributed.
In its desire for a more equitable system, an early move by the present administration was to set up a resource allocation working party, which has produced two reports. The first, an interim one, served as a guide for allocating money to health authorities for the current financial year. The second, entitled "Sharing Resources for Health in England", is now the subject of consultation; although my right hon. Friend the Secretary of State has decided on the extent to which it should influence allocations for 1977–78.
The report, by the application of objective formulae which it acknowledges need further refinement as research progresses and more information becomes available, indicates a wide disparity between regions and make recommendations on how a phased programme of adjustment might be pursued. The existence of sub-regional disparity between areas and health districts is also recognised and proposals made for making the comparisons and effecting change. At this level, particularly, however, it is made perfectly clear that there can be no strictly mathematical approach to allocations judgment will be needed in deciding on merit what is feasible. Much depends on the overall money available and the practicalities of adjusting patient services. As my right hon. Friend the Secretary of State for Social Services said in the House on 25th November:
The tighter funds become, the more difficult it is to make a rapid shift."—[Official Report, 25th November 1976; Vol. 921, c. 319.]
However, the Government are committed in principle to redistribution, and equity demands that we make a determined effort to move in the right direction as the possibilities allow.
To this end the North-West Thames Region, in which Hillingdon lies, was asked this year to operate on a standstill allocation after an allowance for the revenue consequences of major capital schemes coming on stream and for anticipated inflation. The regional health


authority felt unable to make any significant sub-regional adjustment, but set up a regional reserve by withdrawal of funds from all but the most deprived area to meet the consequences of small capital schemes in the region. Area health authorities also had to face some unexpected new developments without additional money, in the knowledge that the discipline of cash limits means that any overspending, which they have been exhorted to avoid, becomes a first charge on next year's allocations. Hillingdon could be no exception to the effect of those decisions. Hence the search for economies, knowing that it could not anticipate any significant increase and perhaps a decrease in resources in 1977–78. In the event my right hon. Friend, in announcing on 21st December 1976 his decision on regional allocations for that year, has promised a slight increase to North-West Thames as a whole. It is, however, too early to say whether Hillingdon will benefit, for the regional health authority has not yet decided how to distribute its allocation, the precise amount of which has not yet been determined.
In looking for savings, authorities are expected to bear in mind the planning guidelines to which I have referred. These place considerable emphasis on improving primary care and community services and to increasing facilities for certain priority groups, such as the mentally ill, mentally handicapped, elderly and physically handicapped—to some extent, if necessary, at the expense of acute services. For the latter, the North-West Thames Regional Health Authority has promulgated interim planning ratios to be used alongside national norms for some of the other groups in planning local hospital bed provision. Health authorities have also been asked to work towards a situation where hospital beds are concentrated in district general hospitals, in community hospitals serving populations of up to about 100,000, and in units for the mentally handicapped.
In such circumstances, it is, perhaps, not surprising that the Hillingdon Area Health Authority should have asked its officers to explore the possibility of closing Northwood, Pinner and District Hospital. At present in the area there are about 870 acute medical and surgical

beds, compared with a need for about 500 when measured by the regional yardstick for the population resident in the borough. There is at present, however, a substantial cross-boundary patient flow, and the authority claims that the theoretical need may well be about 750 if the external catchment areas are to remain its responsibility.
However, exploration has shown, I am told, that, although much of the work at the hospital could be absorbed by the main hospitals of the area, there would be considerable difficulty in dealing with some parts of it. In particular, there was no readily available solution on how the surgical caseload could be dealt with elsewhere, this being the main argument for the authority's decision not to take further action for the time being. Before reaching that decision, the authority also had before it the informal views of among others, the consultant medical staff and the general medical practitioners.
Whether the authority has reached the right balanced judgment is not for me to say, particularly as it had already decided to proceed with formal consultations and calculations on the closure of other small hospitals in the area, on which my right hon. Friend may be called upon to adjudicate in due course. Nor is it clear whether, in the absence of closure, the authority will be able to balance its books. All I would say at this juncture is that its decision demonstrates how the procedures we have evolved work.
Consultation is a meaningful process. Each case is decided on its merits on the light of local prevailing circumstances. In this way, we may expect that the National Health Service will be responsive objectively to changing needs and changing ideas on how health care services should be delivered. It is essential that this should be so. Otherwise, the service would ossify.
Thus, the retention of a small hospital cannot be axiomatic. Everyone is aware of the value that the general public place on the intimate and friendly atmosphere that often exists, where they often know the staff and can receive continuity of care from their family doctor. Where such facilities have to be withdrawn, either because they are not viable or because a more satisfactory overall provision of service can be organised in some other way,


there is no reason why the same personal care and friendliness should not be reproduced elsewhere, as it already is in some large hospitals. The main consideration must always be the most efficient use of resources in the health district for the benefit of the population as a whole.
I am sure that that is a consideration which hon. Members will bear in mind,

just as my Department does and will bear it in mind when considering the proposals which come forward, as they are bound to do in the next year or two, from various area health authorities throughout the country.

Question put and agreed to.

Adjourned accordingly at twenty-nine minutes past Twelve o'clock.